Prediction betting craze wipes £19bn off gambling giants

Chris Price

Fri, February 20, 2026 at 2:32 AM GMT+9 2 min read

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Shares in Flutter, which owns Paddy Power, have tanked by more than 40pc so far in 2026 - Robert Evans/Alamy

The craze for cryptocurrency betting on politics and events has dealt a near £19bn blow to some of the world’s largest gambling companies.

Shares in Paddy Power-owner Flutter have tanked by more than 40pc so far in 2026 over concerns that so-called prediction market platforms like Polymarket and Kalshi will eat up large chunks of its business.

Nearly $16bn (£11.9bn) has been wiped off the value of the Dublin-headquartered gambling group this year, which switched its main listing from London to New York in 2024.

DraftKings, the second-largest online sports betting platform in the US, has suffered a $5.7bn drop in its value in 2026.

Churchill Downs, the corporation behind the 151-year-old Kentucky Derby and the third-biggest listed gambling group, has suffered a $1.6bn blow.

Estelle Weingrod, a JP Morgan analyst, said the gambling sector “has been under pressure over the last few months on the back of prediction markets”.

In the UK, FTSE 100 member and Ladbrokes parent Entain has seen its valuation drop by around a quarter over the same period – a hit of more than £1.1bn. Entain runs BetMGM in the US as a joint venture with MGM Resorts.

Richard Stuber, an analyst at Deutsche Bank, said the decline was driven by “increasing concern regarding US prediction markets as well as the financial implications from the hike in UK gambling taxes”.

Unlike traditional betting platforms, prediction markets let people bet on everything from the second coming of Jesus to which company will have the best AI model by the end of the month.

Prediction markets have boomed in the US with $44bn staked by gamblers last year. The sector is dominated by the world’s two largest exchanges, Kalshi and Polymarket, neither of which are available in the UK.

As well as markets on politics and events, these platforms also let people bet on sports and there are concerns that they will usurp traditional bookies.

Kalshi’s trading volume surpassed $100m during the Super Bowl this month, compared with $27m during last year’s game. One of its biggest markets was on which artists would appear in the half-time show performed by Bad Bunny, the Puerto Rican rapper.

Jordan Bender, an analyst at Citizens, said: “The online gaming industry is showing cracks.”

Matchbook, a popular sports betting group, is expected to roll out the UK’s first prediction market in the next few weeks.

Gambling companies in Britain are also bracing for changes to gambling taxes announced in the Budget last year. The Chancellor announced an increase in the duty on online gaming from 21pc to 40pc, due to take effect from April.

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