Online election gamblers are expecting a $450 million jackpot after Trump wins

Thousands who gambled on the US election are looking forward to a payout of around $450 million from online gambling sites after Donald Trump was elected president in a landslide. But others may have to wait to collect their waste.

Online election betting sites exploded in the final weeks of the election because of how former President Trump’s disagreements in so-called prediction markets differed greatly from opinion polls, causing the race to close due to extreme heat.

Prediction markets “can approximate the wisdom of the crowd when no hard data is available,” says Samuel S.-H. Wang, a professor of neuroscience at Princeton University who is also the director of the Electoral Innovation Lab, which studies elections and electoral reform.

In the traditional poll victory, the prediction markets seemed to work better after Trump won the polarized race. Proponents of prediction markets say they are the most accurate gauge of the real state of a race, sweeping a broad view of the results and capturing, in real time, momentum, media influence, and top stories that can have a seismic impact on campaigns.

It was also a victory for another representative of Trump’s election chances, the Trump Media and Technology Group, whose shares rose in line with online gambling sites before the election. Shares of DJT rose 8% on Wednesday.

The stock has a deep following of Trump supporters, hundreds of whom gathered for an election night event on the social media platform Rumble.

The group’s leader, Canadian pastor Chad Nedohin, flipped his screen between Trump Media’s just-released third-quarter earnings, Trump’s expansion into Polymarket and the results of the victorious election as it poured in.

Predictive payments

Two of the biggest exchanges in the forecast, the crypto-fueled, offshore polymarket that sells contracts to overseas buyers, and the US-based Kalshi, which serves US citizens, together ended up with a fund of about $450 million as of Tuesday evening, according to data from companies. A third site, PredictIt, is an academic research group and does not disclose its remuneration.

In total, Kalshi said 28,000 people bet on Kamala Harris winning, and 40,000 people bet on Trump. Polymarket did not respond to a request for information about how many people placed bets on its site.

Polymarket, which counts Peter Thiel’s founders’ fund as an investor, is allowing bettors to continue placing bets until the betting closes, which happened when the Associated Press, Fox, and NBC all called Trump’s electoral college early Wednesday. The payout was estimated at $287 million on Tuesday evening.

On Kalshi, bettors can continue betting until the launch date of January 20, 2025. Kalshi’s payout pot stood at $159 million on Tuesday evening.

Betting on the prediction markets is not the same as doing so against a regular betting house. Instead, stakes are created when opposing sides of a bet reach an agreement so that the sum each side is willing to pay equals $1.

The Polymarket bettor set for the biggest payout is a Paris-based investor known as the “Polymarket whale,” who made $40 million worth of Trump-related bets on the site. If Trump continues to win the popular vote, he will walk away with $80 million, according to his accounts on the site.

Trader Polymarket’s big bet came with a dramatic increase in Trump’s chances in the trade.

—By Michelle Conlin, Reuters