Are 1.6 billion dollars going down the drain? Behind the 3.3 billion turnover in the World Cup prediction market, your money is feeding weak teams with a win rate of less than 1%.

World Cup prediction market data for this round, I checked three times and confirmed I didn't misread — Polymarket's World Cup-related contracts have accumulated a trading volume of $3.3 billion, directly crushing this year's Super Bowl's $1.4 billion. The gap is intuitive: football is a global event with a long cycle and wide trading window; a single final simply cannot compare.

Platforms like Kalshi are also sharing the spoils, with trading volume surging in football win/loss and championship contracts. But the money is not flowing obediently to the popular champions. By the round of 32, the market was thoroughly split: France and Argentina led, while a bunch of underdogs attracted massive funds.

Polymarket data: France's implied probability of winning the championship is 23%, Argentina 21%, with bets heavily concentrated on a repeat of the 2022 final. Spain 11%, England 10%, Brazil 6%. The advancement probabilities are similar: France 39%, Argentina 38%, Spain 23%. In terms of trading volume, Argentina's championship contract traded $81 million, France $77 million, Portugal $76 million, Spain $68 million, England $61 million.

But the most anomalous thing is that about $1.6 billion was poured into teams with a championship probability of less than 1% — teams that theoretically have no chance of lifting the trophy. Historical trading volumes for underdogs: Ivory Coast $101 million, Mexico $97 million, Egypt $90 million, Cape Verde $87 million, Morocco $82 million. The trading volumes completely mismatch the win probabilities.

This reveals the characteristics of prediction markets: high contract volume does not mean the market is bullish; it only indicates that a lot of trading occurred when early odds hadn't fluctuated significantly. Some positions are cold gambling speculation, fan sentiment buying, hedging arbitrage, parlay combinations, or users simply forgetting to close positions. Traditional sports betting dynamically adjusts odds, but prediction market contracts trade all the way until settlement — funds are trapped in positions that have long been out of favor.

For comparison: buying simultaneously the five hot teams France, Argentina, Spain, England, and Portugal now costs only $0.72 total, and any one of them winning the championship pays $1. Market confidence is highly concentrated, but billions of dollars are still floating on underdog targets.

So don't be fooled by the $3.3 billion total turnover — this list is not just a ranking of championship probabilities, but also a history of traders' full-cycle operations: timing of entries, shelved positions, and unsettled liquidity.

The entire prediction track is accelerating institutionalization. Bernstein predicts that before the World Cup ends, total betting on all platforms will exceed $10 billion. The popularity of the sports track is spilling over into non-sports contracts: a16z data shows that non-sports contracts on Kalshi and Polymarket, such as geopolitics, macro data, elections, total $3.6 billion, exceeding the total of the entire industry a year ago. In July 2025, weekly trading volume was only $200 million, and after 12 months it has multiplied 18 times. Last week, the total weekly trading volume of all prediction markets hit a new high of $14.5 billion, and open interest has maintained $1.6 billion for three consecutive weeks.

But the regulatory axe has also fallen. The CFTC has launched an investigation into Polymarket, and multiple state regulatory agencies are applying continuous pressure. After being fined in 2022, the platform once banned US users, and only limitedly resumed last year. While trading volume hits new highs, legal risks are amplifying.

Platforms like Polymarket and Kalshi bet on sports, elections, crypto trends, and macro data. The core of the CFTC's investigation this time is to distinguish the boundary between compliant event contracts and illegal gambling. The window period is very delicate — regulation tightens, trading volume explodes, and both sides are accelerating.

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