Temperature check: alarm as prediction markets lean into weather and climate bets
Summary
Online prediction markets, which people use to bet on sports and politics, are now growing fast in weather and climate bets. Kalshi, a major platform, has a deal to use weather data to verify bets and sees this market reaching $1.1 billion after rapid growth.Key Facts
- Kalshi is an online financial exchange that allows betting on weather and climate events.
- Kalshi made a deal with the Weather Company to get official weather data for verifying bets.
- Betting on weather and climate has grown 500% in the past year, becoming a $1.1 billion market.
- People can bet on short-term weather like temperatures and long-term climate risks like disasters or water levels.
- Kalshi’s markets appear on the Weather Channel’s app, used by over 330 million people globally.
- Kalshi believes these betting markets can help businesses hedge risks and improve weather forecasts.
- Some people worry betting on climate disasters turns serious events into a form of gambling.
- The platform avoids offering bets on wildfires because of concerns about harmful incentives.
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