Make Some Room
With the return of PredictIt and Polymarket looking for an entry point, Kalshi no longer has the prediction market space to itself.
The Bulletin Board
THE LEDE: PredictIt returns with Polymarket waiting in the wings.
ROUNDUP: MO OSB update; Live! Casino NH’s busy week; NBA betting investigations; Sharpr sold; Barstool + Fox rumor.
NEWS: The haves and the have nots in the US online casino market.
VIEWS: Citizens asks, ‘Has Penn reached an inflection point?’
VIEWS: Spectrum analyzes online vs. retail slots and who casinos are targeting.
AROUND the WATERCOOLER: The summer of The Grinder at the WSOP.
STRAY THOUGHTS: Look, when you're talking to your doctor, just tell him you have a spiral fracture of the left radius.
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The Lede: Are Polymarket and PredictIt Ready to Challenge Kalshi?
There are two significant prediction market developments that don’t involve Kalshi to report.
First, there is the return of PredictIt, one of the first prediction markets authorized to offer election markets (long before Kalshi). As previously covered in Straight to the Point, PredictIt was granted a no-action letter by the Commodity Futures Trading Commission in 2014, allowing it to offer election markets (in a very restricted manner). That letter was later rescinded in 2022, which led to a legal battle that is now moot, as the CFTC has issued PredictIt a new, less restrictive, no-action letter.
Per a press release sent to STTP:
“This victory includes the legal admission, as determined by the Fifth Circuit Court of Appeals, that the prior chairman of the commission acted in an “arbitrary and capricious” manner in seeking to shut down PredictIt — and enables PredictIt to continue operating indefinitely under a transparent and fair regulatory framework.”
The new NAL removes a trader cap (PredictIt was previously limited to 5,000 traders) and increases the position limit from $850 to $3,500.
PredictIt will not be offering sports betting markets (at least not presently), and will stick to elections and other political markets.
Also of interest is PredictIt’s research-based approach.
"PredictIt’s role in contributing meaningful data to researchers and media is a vital part of understanding political behavior and voter trends," said John Aristotle Phillips, co-creator of PredictIt.
And per the press release, “The platform will now be governed by a non-profit entity, the Prediction Market Research Consortium, advised by academic experts from Princeton, Rutgers, and Wake Forest.”
The other news item is the Department of Justice’s decision to end its investigation into Polymarket. According to Bloomberg (who first reported the story):
“The predictions exchange received formal notice earlier this month from the US Justice Department and Commodity Futures Trading Commission that the probes had ended, according to a person with direct knowledge of the matter, who asked not to be identified discussing the confidential inquiries.”
Recall that the Polymarket CEO, Shayne Coplan, had his home raided by FBI agents back in November. As I wrote at the time: “Coplan and others believe it is political, but there is also the possibility it has something to do with 1) the French bettor who won $85 million betting on Trump or 2) accusations that Polymarket allowed US residents to bet on the election.”
And as I noted when Polymarket signed its deal with X:
“The deal solidifies Polymarket’s global presence and potentially positions Polymarket as a strong competitor to Kalshi in the US — Polymarket remains barred from US users due to a 2022 CFTC settlement; however, with the changed environment around prediction markets at the CFTC, the company has signaled an interest in returning to the US.”
Roundup: MO OSB Update; Live! Casino NH’s Busy Week; NBA Investigations; Sharpr Sold; Barstool Rumor
Three applicants for two untethered sports betting licenses in Missouri [Sports Betting Dime]: DraftKings and FanDuel were no-brainers, but a surprising third applicant for one of Missouri’s two untethered sports betting licenses has emerged: Circa Sports. First reported by Larry Henry, Circa filed the application on July 15, just before the deadline. By seeking an untethered license, Circa would not need to partner with an in-state casino or professional sports team. However, it’s twice as expensive ($500,000 compared to $250,000) and requires certain minimum standards, including platform quality and experience in other regulated markets.
Live! Casino Salem opens its doors in New Hampshire… Then sold to Churchill Downs [Eagle Tribune]: Live! Casino Salem recently had a ribbon-cutting, kicking off the first phase of the charity casino’s entry into the New Hampshire market. The property is (or better put, was) a joint project between Cordish Companies and local developers, Joe Faro and Sal Lupoli. As STTP has noted, the presence of Cordish Companies makes online casino legalization (New Hampshire is one of the best candidates) more difficult. However, Cordish is no longer involved, as its 51% majority stake in the property is being sold to Churchill Downs, along with 39% of Faro and Lupoli’s stake, leaving them with 10% ownership. The news came just a week after the casino opened. For anyone hoping this will help New Hampshire’s online casino efforts, Churchill Downs, like Cordish, is a member of the National Association Against iGaming.
NBA is still investigating Terry Rozier for suspicious betting activity [SI.com]: An update on the Terry Rozier gambling investigation from SI: “Miami Heat veteran guard Terry Rozier remains under federal investigation in a gambling probe, according to a report from NBA insider Chris Haynes. The report from Haynes comes two weeks after ESPN's Shams Charania reported that Rozier had been cleared "as of right now" by the NBA.” The investigation centers on suspicious betting activity during a March 23, 2023, Hornets-Pelicans game, in which Rozier exited after 9 minutes, citing a foot injury. The NBA is awash in gambling investigations, including Jontay Porter, who was banned for life, and more recently, Malik Beasley.
Friend of the newsletter Cody Luongo’s Sharpr newsletter has been acquired [Sharpr]: “Big, breaking news today: Sharpr has been acquired by The Insights Group, a new media and events venture in the digital entertainment space co-founded by Esports Insider’s former co-founder (and a long-time friend of mine), Sam Cooke, alongside Alfie Wright.” This is an incredible moment for the newsletter that’ll help take Sharpr to new heights.”
Barstool and Fox Sports mashup in the works [Andrew Marchand, X]: File this one under of interest: “Barstool and Fox Sports are in advanced talks that would see top Barstool personalities, including Dave Portnoy & Big Cat, appearing as part of its new FS1 daily programming lineup leading into Colin Cowherd at noon, while Portnoy would be part of Big Noon Kickoff, sources confirmed.”
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Why events contracts will end up “winner take most”
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News: Five States Generate Nearly Half of All OSB GGR
An interesting nugget from Eilers & Krejcik Gaming (a newsletter sponsor), with the firm noting that five states are responsible for nearly half (44%) of all online sports betting gross gaming revenue: New York, Illinois, New Jersey, Ohio, and Arizona.
An important caveat is that the data only uses state-level reporting, which means Florida is omitted.
The GGR generated in those five states equals the GGR in the following ten states: Massachusetts, Pennsylvania, Virginia, Maryland, North Carolina, Tennessee, Colorado, Michigan, Indiana, and Louisiana.
What jumps off the page is the inclusion of Arizona in the Top Tier (and nearly ahead of Ohio for fourth in handle and GGR — Arizona has the sixth highest OSB GGR per adult.
Why is that surprising? The state has a population of just 7.4 million, which is significantly lower than four Tier 2 states.
New York: 19.9 million
Pennsylvania: 13 million
Illinois: 12.6 million
Ohio: 11.8 million
North Carolina: 10.8 million
Michigan: 10 million
New Jersey: 9.5 million
Virginia: 8.7 million
Arizona: 7.4 million
Tennessee: 7.1 million
Massachusetts: 7 million
Indiana: 6.8 million
Maryland: 6.2 million
Colorado: 5.9 million
Louisiana: 4.6 million
Views: Has Penn Reached an Inflection Point?
The analyst team at Citizens recently raised its target price for Penn to $24 (a 38% increase), stating that while the company has faced significant headwinds from the expansion of its online businesses, it has reached an inflection point and there is light at the end of the tunnel.
According to Citizens, “Several catalysts, including casino openings/growth and shareholder returns, should bridge PENN into 2026, whereby the digital business turns into a call option for value, in our view.”
More importantly to my readers, Citizens is joining a growing list of analysts and pundits who suspect Penn will pull out of its deal with ESPN in August 2026.
“We believe there is a real possibility the partnership with ESPN does not extend beyond the opt-out period in August 2026, serving as the largest catalyst for shares, leading to massive cost savings as the sports betting business could be restructured to support a smaller app with an iGaming-first approach... Said another way, sports betting is creating a material drag on earnings.”
News: Two Nuggets from Spectrum Gaming
Two recent Spectrum Gaming Insights have been living in my bookmark folder.
Nugget #1: Casinos Targeting High-Value Customers
In a case of less apparently being more, casino visitations are down, but win per visit is up, with casinos' focus shifting from “How do we attract players?” to “How do we attract the right players?” in a post-COVID world.
Per Spectrum Gaming, “Rather than simply filling the floor, marketing departments shifted into yield-managing the casino floor… To achieve this outcome, marketing departments curtailed offers to low-end players. As expected, these players reduced visits, freeing scarce capacity for higher-spending players. This was an “aha!” moment for casino operators – and the practice continues today.”
As Spectrum noted, whether this trend can survive a recession is an open question. And I’d add that the recent cap on gambling loss deductions could also necessitate casinos to revert to a ‘more is more’ strategy.
Nugget #2: Online Slots are Cheaper to Operate
“One of the unpublicized benefits of igaming – for operators, anyway – is the lower operating costs and potentially higher margins… The reduced cost structure means that igaming operators can be profitable at lower hold percentages (i.e., higher payout percentages from a player’s perspective) than a retail casino.”
Around the Watercooler
Social media conversations, rumors, and gossip.
Michael “The Grinder” Mizrachi has won the 2025 WSOP Main Event!
Mizrachi is likely the most consequential World Series of Poker Main Event champion since Chris Moneymaker kicked off the Poker Boom with his improbable 2003 WSOP victory.
The Grinder ticks off virtually every box you’d want in a Main Event champion:
A well-known, top-tier poker pro that fans know and love, and that the poker community respects.
Had a fantastic summer that lets the headlines write themselves. In addition to winning the Main Event, he also won the $50,000 Poker Players Championship (his fourth time, a record), now holds eight overall bracelets, and was inducted into the Poker Hall of Fame on the spot after his Main Event win, an honor that has never been bestowed before.
In a summer of fantastic performances by Shaun Deeb, Benny Glaser, and Leo Margets, and an ignominious one by William Kassouf, 2025 will go down as the year of The Grinder.
Stray Thoughts
The greatest movie scream of all time was Ryan Gosling in The Nice Guys.