Substack has updated its partnership with betting platform Polymarket, “introducing native tools that make it easier to share, discuss, and debate prediction market data directly on Substack.” Additionally, Polymarket will effectively pay “a cohort of creators,” including Matt Yglesias, to use its data though the newsletter platform’s pilot sponsorships program.
This is just the latest foray of prediction markets into media. Last week, Dow Jones agreed to incorporate Polymarket’s betting data into its “content,” including The Wall Street Journal. A month before that, CNN incorporated Kalshi’s betting odds. In December, CNBC agreed to infuse its programming with Kalshi data. Noted poker player Nate Silver, once a respected stats journalist, is now an advisor for Polymarket.
“If you get the news before it happens, that should be even more economically valuable.”
This looks like a concerted effort to confuse people about what news is and does. Here’s Robinhood’s CEO Vlad Tenev, one of the leading profiteers from America’s financial nihilism: “I like to think about prediction markets as the next generation of the news. We know the news is economically valuable. People pay for getting the newspaper; they pay indirectly for shows like this [Squawk on the Street on CNBC] through advertising, and so if you get the news before it happens, that should be even more economically valuable.”
Let’s stop for a moment and think about what news is, since the slippage in Tenev’s quote (“if you get the news before it happens”) highlights the problem with his line of thought. It kind of seems like people have recently become confused about the difference between information, journalism, and “content.” The earliest known predecessor to journalism is Rome’s Acta Diurna, which was in circulation more than two millennia ago — basically an official record of events, such as births, new laws, and financial data. (A similar publication circulated in China starting in the Tang dynasty.) In 15th-century Europe, businessmen began disseminating written accounts of important events to their contacts; this is essentially the predecessor to the modern newspaper.
Do you notice anything here? That’s right: News is a record of things that have happened. Weather forecasts and horoscopes aside, newspapers do not traffic in predictions. They tell you, instead, about the very recent past — what happened yesterday. An online news site, not constrained by a printing press, can even tell you what happened 20 minutes ago. But no news organization exists to predict the future. By definition, you cannot know the news before it happens.
The actual function of news, however, can sometimes be obscured by what Daniel J. Boorstin calls “pseudo-events,” which are planned events that can be repeated, such as awards shows, press conferences, political conventions, and earnings calls. Unlike true events — natural disasters, a vote at the city council meeting, an assassination — the outcome of a pseudo-event can be known in advance because it is planned. Its contents can be distributed to reporters “under embargo,” so that when the pseudo-event occurs, reporters can instantaneously run a story.
The conflation of betting markets and news began with political coverage
Lots of publications, including this one, include coverage of pseudo-events — an Apple event is a great example — alongside the accounting of real events. In Boorstin’s The Image: A Guide to Pseudo-Events in America, he suggests that news outlets cover pseudo-events in part because there are not enough actual events to fill out the news cycle. There is also tremendous consumer demand for pseudo-events; celebrities, which are pseudo-events made flesh, are so significantly popular that an entire ecosystem of publications exists for them.
Pseudo-events have overtaken actual events in Hollywood, where they have long been generated to create marketing for movies. The other place where pseudo-events dominate real events is politics. Speeches are pseudo-events, which is why journalists often receive the drafted remarks in advance; so are press conferences, social media beefs, ribbon-cuttings, and the Presidential pardoning of a turkey. I bring this up because I believe the conflation of betting markets and news began with political coverage.
In 2024, no one was sure how reliable presidential polling was — since people were increasingly using mobile phones rather than landlines, and often not picking up because of a deluge of spam calls. Polls, of course, look more like pseudo-events (press releases) than actual ones (six-car pileups), and exist in part to drive conversation. They are not the same thing as news; polls are, at best, a snapshot of a specific group at a specific time asked specifically -worded questions and, at worst, political horoscopes. I’m not convinced newspapers should be in the business of reporting on polls, much less running them.
Still, people — at least editors and reporters, and maybe the audience too — wanted some indication of what might happen in a presidential election. Prediction markets were so confident that Trump would beat Harris that they made traditional newspapers, which saw the race as a toss up, look like they were waffling. (And if you don’t really understand how probability works, you too probably think Polymarket was more correct than “tossup.”) So betting markets were suggested as a viable alternative to polls; the idea was that people were so confident in a specific outcome that they were willing to wager on it. And that’s how odds on Polymarket and Kalshi started to creep into stories.
“These markets have changed the way people consume news.”
The other argument in favor of betting markets, as made by their advocates, is that they contain insider information. This is “cool,” according to Polymarket’s CEO, Shayne Coplan. It is also illegal. That doesn’t matter much to the purveyors of gambling-addiction-as-a-service; because contracts are peer-to-peer, the house isn’t getting ripped off. It’s only the punters dumb enough to enter the bet without insider information who’ll lose their shirts.
There are several examples of plausible insider trading on predictions markets: the entity who cashed out with almost half a million dollars when the US snatched Venezuela’s president, for instance — an actual event that occurred in order to create pseudo-events. (Baudrillard would be so proud!) Or the bettor who made more than $1 million by placing bets on what Google’s 2025 Year in Search rankings would be. Or the trader who made $50,000 by betting correctly on the recipient of the Nobel Peace Prize.
A great deal of volume in prediction markets is sports betting, though predictions markets mechanically work slightly differently than straight sports bets. A standard sports bet has the punter taking one side and the house taking the other; in prediction markets, there are punters on both ends, and the house just takes a cut of the trade. Also, prediction markets deal in contracts, which can lead to ambiguity — such as whether Cardi B’s dance during Bad Bunny’s Super Bowl halftime show counted as a performance. It is possible for the spirit of a contract to be fulfilled (the US kidnapped the president of Venezuela) while the letter isn’t (according to Polymarket, this was not an “invasion”).
It is unclear to me how helping gambling companies rip off your audience serves the public interest
This distinction, silly as it sounds, may actually matter. While some states have indicated they believe prediction markets should follow the legal framework for sports betting, the feds think those states should fuck right off. Any moves by the states to limit insider trading on betting markets will be blocked by Mike Selig, the chair of the Commodity Futures Trading Commission. “These markets have changed the way people consume news,” Selig says, accurately.
Obviously, as the Year in Search and Nobel Prize bets show, it’s easier to correctly bet on a pseudo-event than an actual one. But the consequences of insider information on actual information are potentially more devastating — the leakage of state secrets, and not to protect the public. As media critic Matt Pearce points out, there’s a problem of incentives: ethical journalists cannot pay sources, but prediction markets do.
Of course, for the insiders to make their money, there must be a steady supply of suckers. And there is! Only about a third of traders actually make profits, and “a large number of traders systematically lose money to a small minority of skilled participants.”
So by partnering with these betting markets, news organizations — from the legacy entities like WSJ or CNN to the burgeoning new media platforms like Substack — have undercut themselves two ways: first, by commodifying information and then by effectively endorsing competitors who can pay for that information; and second, by serving as advertising for prediction markets, making their audience vulnerable to getting ripped off by insiders. It is unclear to me how helping gambling companies rip off your audience serves the public interest, which is, or at least once was, the point of newsgathering.
A cynic might suggest that the move to embed betting markets in newsrooms is mere marketing
And the public interest is why most of us got into this business in the first place. Most journalists aim to reflect reality back to readers, without any particular interest in whether that makes said reader wealthier. The Fourth Estate, as news organizations are sometimes called, is meant to wield political power by uncovering wrongdoing, embarrassing the government into action. From Enron to Theranos, multiple frauds were first uncovered not by the SEC, but by the press. Back when corruption mattered in politics, many of those scandals — from Watergate to whatever we want to call George Santos’ whole deal — were also discovered by journalists rather than the Department of Justice.
This is not to say that reporters are always right, or that journalism always achieves its highest calling. I am, after all, old enough to remember the non-existent “weapons of mass destruction” that The New York Times reported on to justify the war in Iraq. But as suggested by my catty little remark about the WMDs, journalists are expected to be accountable for their mistakes. Any reputable newspaper or magazine runs a correction when even a word is off. (That NYT refuses to admit to its major errors is a longstanding area of consternation among other journalists.)
Prediction markets, on the other hand, make their money through transaction fees — and thus through volume. In true nihilistic fashion, these markets care less about the outcome of a contract than an actual casino. It is possible to feel betrayed by the various failures of mainstream media, but Kalshi, Polymarket, and Robinhood are only after your money. A cynic might suggest that the move to embed betting markets in newsrooms is mere marketing: an attempt to signal that these are somehow different from, and superior to, casinos. Certainly that’s what I think.
What’s less clear to me is why newsrooms are going along for the ride. (I have my suspicions about why this makes sense to Substack.) Is Dow Jones so strapped for cash that it’s stooped to this? Or is it the case that the people running CNN, CNBC, and Dow Jones truly have gotten so confused by pseudo-events that they no longer understand the difference between concocted media circuses and actual happenings in the world?
I also wonder whether this push to legitimize gambling will undermine trust in people who are trained and accountable, who specialize in writing about reality. In the same way that many audiences prefer pseudo-events to events, we may discover that people prefer the “wisdom” of thousands of anons attempting to predict the future to actual reporting on the current conditions around us. Seems like that’s what Polymarket and Kalshi are betting on, anyway.
