30 PUBLIC GAMING INTERNATIONAL • JULY/AUGUST 2026 At the PGRI Spring 2026 conference, results of a study commissioned by Inspired Entertainment and conducted by Lotto Research (Simon Jaworski, simon@lottoresearch.com) showed a startling and ominous effect. Lottery players, once exposed to prediction markets, had a substantially less favorable view of lottery products. This suggests a new type of competitive threat, one that actively devalues your brand. The race for new, younger players is even more important and the challenges in retaining high LTV (life-time value) players are even more essential. Prediction markets have been in many news headlines, but defining what they are is more elusive. A way to look at prediction markets is that they provide a service that allows people to take a financial position based upon a future outcome of: a sporting event, a sports-related matter ( will the Milwaukee Bucks trade Giannis Antetokounmpo), entertainment ( who will win 2026 Best Picture Oscar, or will Taylor Swift have a baby within a year of marrying Travis Kelce), political elections, auction prices realized…almost anything. There is much to know and much that is changing, but here is a starter framework: 1. Prediction markets are old – Some historians talk about prediction-like markets dating back before 2000 BCE in China. May 2, 2025, The Wall Street Journal, in an article about prediction markets, reported that in 1591, Pope Gregory XIV issued Cogit Nos prohibiting betting on papal elections or papal tenure. 2. And new -- the two market share leaders, Kalshi and Polymarket, both were founded less than 10 years ago 3. It’s about jurisdiction – There is a rapidly changing litigation and legislative action. In general, prediction markets take the position that what people are doing with their money is funding “event contracts” (versus traditional gambling) and therefore the activity should be regulated at the Federal level by CFTC (Commodity Futures Trading Commission). States have argued that prediction markets in fact are conducting gambling under a different name, therefore should be regulated by State gaming boards. It is easy to imagine years, if not decades, of court battles and appeals on this subject. 4. And other issues – Senators Richard Blumenthal (CT) and Andy Kim (NJ) have cosponsored the Prediction Markets and Integrity Act (for more, go to blumenthal.senate.gov/newsroom for the March 11, 2026, release). Their issue is a bit different. One of their expressed concerns is that prediction market outcomes my be influenced by non-public information, and that is more like the familiar concept of “insider trading” that we hear about with traditional equity markets. Could people with specialized knowledge, even classified or top-secret information, be subject to coercion or the financial moral hazard to sell information with so much money at stake? As above, there likely will be years of developing legislation and challenges. 5. It’s big – Bernstein analyst Gautam Chhugani predicts total market volume will reach $240 billion for 2026 and climb to $1 trillion by 2030 (Investment News, April 15, 2026). Fan Duel and DraftKings exited the American Gaming Association late 2025 to avoid the AGA rules that prohibited their participating in prediction markets (Sports Business Journal November 18, 2025). This combines very rapid growth by existing providers, plus new powerful entrants to the market. 6. And personalized – Lotteries have become much more adept at personalizing their marketing communication, and on iLottery even serving game options better tailored to individual preferences. That being said, the fundamental product is the same for all players of a certain game type, and it all is math-based outcomes. Prediction markets, because they can cover future events from an almost infinite number of disciplines that each appeal to a market segment. Fine art auctions, European politics, space travel, let alone sports…if you like it, you can focus on that in a prediction market. 7. It is formidable competition, but there are some reasons for optimism, provided you take transformational action – in the next article, we’ll explore traits and differences in different types of lottery players versus what may be a typical prediction market player. We’ll reintroduce the concept of ICP (Ideal Customer Profile) and what that means in terms of where you can focus your limited budget resources. n This article is for informational purposes only and does not constitute legal, business, or financial guidance or advice of any type. Contact: Donald.Silberstein@scapromo.com Lottery Competition, Part 1: 7 Things to Know About Prediction Markets Don Silberstein, Senior Vice President, Marketing & Business Development, SCA | scapromotions.com
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