The Herd with Colin Cowherd - The Favorites - The Future of Sports Betting

Episode Date: July 11, 2025

On today’s show Action Network hosts Chad Millman and Simon Hunter are joined by Chris Gerlacher, a reporter with Prediction News who's covered the rise and regulation of prediction markets worldwide for several years.  The influence of these prediction markets as businesses has become an increasingly important narrative in the sports betting space overall. Now legal in all 50 states, Kalshi just raised $185M and is valued at $2 billion. Internationally-focused Polymarket announced a raise the same week to hit unicorn status of $1 billion. Meanwhile, prediction markets stand to benefit the most from the continued legislation which impacts professional bettors, as well as continued bans from operators who don’t want their business. #VolumeSee omnystudio.com/listener for privacy information.

Hey guys, it's us The Jonas Brothers. I'm Joe. I'm Kevin. And I'm Nick. And guess what? We created our own podcast called, Hey Jonas. We invented a podcast? Well, we didn't invent it.

We just contributed to it. We're the first people to do podcasts. We get to ask other people questions because we're sick and tired of being asked questions. Well, sick and tired is a strong way to put it. But, you know, tired and sick. Listen to Hey Jonas on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. Just listen. We don't care where you hear it.

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Listen to humor me with Robert Smigel and Friends on the I-Heart Radio app, Apple Podcasts, or wherever you get your podcast. Hey, it's Edwin Castro, also known as Castro 1021. And I'm Kunky, his best friend and business manager. And we've got a new show called The 1021 podcast. I'm taking you behind the scenes on how I became one of Twitch's most popular streamers. We also love sports. And with the World Cup right around the corner, we'll be breaking down the biggest

storylines ahead of the big tournament here in the USA. Listen to the 1021 podcast on the IHeart Radio. Apple Podcasts, or wherever you get your podcasts. I'm Joey Dardano, and on my new podcast, Hope From a Hypocrite, I'll be changing lives, helping people in need with thoughtful solutions. Sike, I'm a comedian. I'm not qualified to give good advice. Join me and my comedian friends as we riff, rant, recommend some of the most legally dubious advice known to me.

This is Help from a Hypocrite, the worst advice from the dumbest people you know. Listen to Help from Hippocrite Wednesdays on the IHeart radio app, Apple Podcasts, or wherever you get your podcasts. Welcome to the favorites of the podcast, part of the volume podcast network. I am Chad Milman of the Action Network. We are doing part two of the show that we started on Tuesday. Let's welcome in my co-host, my companion, my compadre, my BFF professional buddy, Simon, Hunter.

Hello, Simon. Chad, I heard the dumbest dad joke when I was in England. and I forgot to tell you about on the last show. As soon as I heard, I go, Chad would love this dad joke. So my younger cousin there, young lad, just had his birthday. And my uncle goes up and he goes, Charlie, how old are you now? And he goes, nine. He goes, oh, I didn't know you spoke German.

I was like, damn, Chad's going to love that. So everyone out there can use that one time. If you know a kid that's turning nine, you can use that one time for life. Dude, I'm so old. I don't even have nieces and nephews turning nine anymore. All I have are irascible teenagers who like to throw everything I've ever said in my life back in my face. That's the entirety of my existence. It's kind of like working with Matt Mitchell and Gifford on this podcast. Simon, I want to bring in Chris Giro Locker, who's with prediction news and has been covering prediction markets for a very long time.

And because we talked a little bit about this in part one on Tuesday, because there's been such a confluence of circumstances that have been impacting the sports betting and the gambling universe in the last 10 days. And to me, the growth of these prediction markets and the influence and impact of these prediction markets is one of the biggest things out there. And I mentioned, you know, I've been working on this book and I've done a lot of reporting around these and spoken to a lot of the principles and the players at Kalshi at sports trade. And they're really becoming increasingly important players in the space. As I mentioned the other day, Kalshi raised $185 million.

It's now worth $2 billion. Polymarket raised. It's now worth a billion dollars. my conspiracy theory that I talked about a little bit on Tuesday, nobody is benefiting more from the new tax regulations in the big, beautiful bill in which professional betters are now only allowed to deduct 90% of their losses, not 100% of their losses. Nobody benefits more, in my opinion, than prediction markets. because those are regulated and taxed in entirely different ways.

I am excited to get Chris Gerlocker on the show because he can help us break all this down. Chris, welcome to the favorites. Hey, Chad. Thanks for having me. This is cool. Well, I can send your enthusiasm. So before we get to that, Simon,

Matt Mitchell was rushing us off the other day. Yeah, he gave us a yank off the curtain. He like was so, it was so annoying because I felt like you were digging in on a couple things. And Chris just indulges for a second because the big beautiful bill in which gamblers are now only allowed to deduct 90% of their losses versus 100% of their losses. So all of a sudden, if they could be paying taxes on money, they did not win. Simon, you mentioned you're trying to figure out what to do because you think it will kill. how professional betters live in this country. It may not kill how they live,

but it may change how transparent they are with their taxes, or they got to leave the country and decide to do it from somewhere else. Unpack that a little bit more, some of the conversations you've been having with either accountants, with lawyers, with other people in the space, like explain the impact here because I don't think people get it. And by the way, it doesn't just impact professional betters. like draft Kings, Fandah, they will send you sort of basically sheets, forms at the end of the

year in which you are responsible for documenting what your potentially taxable income was as a better. So this is for everybody. Yeah. No, it's just bad for it. But that's why the guy, I hope you're right that it's, it doesn't go through and that something does change because luckily we get the rest of this season upcoming. Like it doesn't go into effect, I believe, until 2026, which is a big deal. So whatever I win this year legally, I can still report my wins and losses. But, yeah, Chad, we're talking about people like me

are just constantly looking for an edge. And that doesn't come just with sports betting. That's just about everything I do in life. It's a microcosm of everything in life. I'm always looking for an edge. So I told you my favorite contests, that we do pick contests, we do legal ones. My favorite pick contest are tax-free ones.

Those are ones that are off the books. So, you know, people are going to go back to what they never even left, which is mainly offshore books or your local book, which we know is got a hint of crime underneath the belly of it. So it's like guys are going to go back to that. They want to stay in the States. I like being above board. I like what we have now with legalization. and, you know, it's a hard life having everything be cash.

So getting things to now what it is, which is, you know, I pay tax on everything. I like it. And, you know, I knew, not that I knew this was coming, but we had heard whispers. And, you know, again, we can dive to New Jersey part of this because New Jersey's stuff is insane. It's literally, I feel like a bill written just to go after someone like me. I am a narcissist in many ways, but that one just is insane. to me attacking runners, but it really is the point, Chad, where I'm going to be forced, possibly to leave the country for six months out of the year, right? England is no taxes.

I can win big money and pay no taxes on the winning. Same with my losses in England. It's very different their taxes towards gambling than it is here in America. So that off the get-go is a big deal. And many professional betters are going to look into that. Now, getting three months to a six-month visa to England, that's a whole story inside itself. knows my mom's from england i can have dual citizenship it's no problem um you know that's something that happens basically when you're a wee young lad so to me it's it's not going to be a hard transition to a lot of guys the guy was just meeting with in Vegas i don't think they've ever even left the country let alone go to england so they're they're the ones that to me will go back to the

dark books and um again there's ways around it it's just the normal better having to pay having already try to make a winning betting and then having to pay 10% on their losses. I just can't believe it. I can't believe it. I really can't. I know how stupid a lot of the stuff in our government is, but this one is up there. And what we're about to dive into, you know, the polymarket, something that's going to help counteract this in many ways.

So I'm here. I'm excited to learn more about it from Chris here because, you know, to me, to me, a lot other people chat, it was something that really blew up when it came to politics. politics. And it's obviously going to try to take advantage of what's about to happen right now with these sports books. So yeah, very unique, interesting time we're living for sure with the sports buddy markets. Chris, thanks for letting us sort of finish up that conversation. But Simon brings up the politics. He brings up polymarket. For anyone listening who, because we haven't talked a lot about Kalshi, we haven't talked a lot about sport trade. We haven't

talked a lot about polymarket on this show. Give people a primer. You are. an expert in this, you write for prediction news, you've been covering this for a long time at a professional level, give people a primer on what's happening in this space. Sure. So, you know, for those who don't know, prediction markets are, you know, they're an exchange where you can buy and sell contracts on whether an event will happen. And every contract is priced between one cent and 99 cents. And the price ends up being how likely that event is to happen. And, you know, the more valuable your contract is, the more likely it is to pay out. winning contracts, pay out a dollar each and losing contracts get nothing.

So it's this really cool, interesting way to aggregate a lot of information and kind of get a snapshot of a forecast if you're in it for the forecasting. But if you're in it for the gambling too, it's constantly live. So it's this really strong and unmatched live betting experience as well that makes it really good for recreational betting. So if you look at sports trade, you know, they've been offering sports contracts since 2022. they've just been doing it under state gambling law. So they've got their licenses, I think in five states now.

And they're, you know, safely considered a gambling company. Now when Cali first launched, they were not offering sports or elections or, you know, bleeding over into any of these other subjects. They were all about, you know, economics, finance, some pop culture. But, you know, sports was a red line for a while and elections was a hard line. But they'd been trying since at least 2020. or 2022 to offer, you know, first it was election or betting on the midterms. And then they finally won their lawsuit in October, well, September, 2024.

And we're able to finally launch in October. So, you know, there's just been a lot of explosive growth and publicity surrounding prediction markets during the 2024 election, because that's when you get your first, you know, high volume, commercial, you know, really. big regulated prediction market. I mean, yes, polymarket is huge, but it's in the crypto space, and it's not that it's not popular. It's not that it doesn't have a ton of volume. It's just that if you're a regular guy, you know, you can either go learn Web 3 and go learn how to play with crypto and, you know,

figure out the wallets, or you can just go to Kalshi, throw down a debit card and start betting. Right. CaliC is legal in the United States. Polymarket is not. Calci is regulated by the CFTC, the Commodities Futures Trading Commission. Polymarket is not. trade, like you mentioned, has decided to go through the state licensing process. To me, this is what's so fascinating. Alex Kane, who started sport trade, wonderful guy, thoughtful, energetic, enthusiastic, really earnest years ago was a visionary and had this idea to start a prediction exchange, essentially, a betting exchange based on sports. And he went the route of getting regulated state by state as a sports betting operator.

Kalshi started by a couple of people who got to know each other at MIT and then became options traders as interns and places like Citadel. And then they were like, wait a second, people are betting on these particular commodities based on who they think is going to win this election, can we just offer markets on the elections and things like, will the Fed raise interest rates? And they graduated from MIT, started this business, and they decided to get licensed by the CFTC,

which they are, since January, they have been offering markets on sports. And Chris, this is where it's gotten really interesting because Kalshi is offering. you know, bets, markets, contracts on the Super Bowl.

Then they're offering markets on March Madness. Now, the majority of the trading volume on Kalshi, and I would recommend an addiction to what Chris does with prediction news.

Everyone should read Dustin Galker. He's got a great substack called Eventorizen about this stuff. He did an email today that showed the volume traded on Kalshi

something like 80% of it is sports. And so they're basically operating as a entity offering the ability for people to predict the sports markets. I'm not going to use the phrase betting at a national scale and they've bypassed the regulatory markets in the states. How is that even possible? Well, this is one of the interesting things that's really come to life in, you know, Cali she's fired first over elections, but especially over sports.

The finance industry is very comfortable with kind of these parallel regulations, these parallel regulatory structures. So like if you want to trade gold, and this is something a former CFTC lawyer told me a while ago, but if you want to trade gold, you can trade it as a commodity. That's a transaction overseen by the CFTC. Or you can trade in a gold EFT in an exchange traded fund. well, that's a transaction overseen by the SEC, different regulatory agency. It's the same thing.

You're training gold either way. And nobody really planned out these two different ways to make an identical trade, but it happened. And people who like markets are very excited about having the different options to be able to make their same trade in a different way. And that contrasts almost completely with the gambling industry where everything, you know, for good reason, has to be under kind of one. regulatory umbrella. I mean, no one has ever described, you know, sweepstakes casinos or like gray market slot machines and gas stations as, you know, great, you know, liquidity providers or, you know, great for pricing or anything like that. So, you know, I think that's one of the, one of the reasons that these two industries are really talking past each other in court is just they're looking at

this completely differently. Right. So since Cal She has offered these markets, They've gotten cease and desists from, I think, seven states telling them to stop. New Jersey, Maryland, a bunch of others. They keep losing because they have this imprimatur of being a legal entity, a legitimate entity for offering these markets from the CFTC. and what's interesting is Kaushi includes Donald Trump Jr. as an advisor and the incoming chairman of the CFTC is a former board member of Kalshi who in his hearings to be confirmed said, I'm fine with sports markets being part of commodities exchanges. So you know that's not going to change.

That's just going to continue to be the way it is. If change happens, it's going to come from the courts. It's not going to come from Brian Quintens and the CFTC. The district court in Maryland right now is one of the interesting ones to watch because Nevada and New Jersey granted Calci's preliminary injunction. They said, you're probably going to win on the merits. The federal preemption probably applies here to, you know, state gambling regs. But the Maryland judge, they, he asked for a lot of supplemental briefs.

He said, you know, let's get some of these issues on the table and really flesh them out. And, you know, one of the big briefs that came in a couple weeks ago was from the Indian Gaming Commission. And, you know, that that was probably one of the first times that, you know, one of the federal laws that Cali sports contracts could, you know, cross was, you know, that was the first time that argument was really built out really well. So the Indian Gaming Regulatory Act that, you know, forms the foundation of Indian Gaming. That's a federal law. That's not a state law. And so while, you know, like I think briefs in New Jersey and Nevada like listed the the Wire Act and Paspa and IGRA kind of alongside each other saying, hey, this could be an issue. The tribal brief was really the first one where you see the argument spelled out in detail.

And so that by itself is really interesting. And Judge Abelson choosing to, you know, allow the tribes to file their amicus brief in Maryland is also interesting. because Calci originally didn't want that. They were calling it, you know, unhelpful and too late, which makes me think the tribal brief is stronger. So, no, I mean, there's a potential turning point there. I mean, you know, in the game of rock paper scissors, a federal court beats a federal regulator.

So if either the district court in Maryland or the Third Circuit in New Jersey, you know, rule that these contracts, you know, bleed into gaming, then, you know, you'll probably see a Supreme Court fight in an escalation. but Maryland really is one of the big turning points for sports contracts in general. So we still don't know how safe a haven Cali is going to be for sports betters until those two cases in particular progress a little bit further.

Simon, by the way, I mentioned before Dustin Galker's event horizon. He had an email today that said it was 70% of all volume at Cali was from sports, led by tennis baseball, and by the way, the hot dog contest, the hot dog eating contest. Simon, you're like in the middle of this. And do you see prediction markets as a viable alternative if you are a professional better who gets limited at every operator who's now going to be taxed at a more disqualification,

advantageous rate, do you look at these as something that you'd want to dive into? Yeah, I've dove into it, but like we talked about, I've only dove into it for unique situations, like politics or the Pope and things like that. So to me, this is something else that, you know, it's, they're welcoming. That's the biggest difference, right? They don't reject bets here. They will take your money because they want people to be in it. This is early days, Chad. Like the parallel between this and when fantasy football was letting us do those private tournaments for cash, and that sped us up on this whole crazy whirlwind of what this became sports betting being legalized in this country, this feels like another kind of moment we're living in here where I'd love to have your view on this, Chris,

is this going to be here in five years? Is this going to be here in 10 years? Or is this just a flash in the pan? Are we just living in this quick moment where they're kind of figuring out these little loopholes? But like you said, eventually a court will come down on them with a hammer and then they're just going to be gone. Like they just popped up for a year or two, now they're gone. Like, what's your view on this going forward? I think election contracts have some, I think they can last.

I think they have the ability to last. Sports is going to be a little bit more up in the air until these court cases are finally settled. If you take a step back and look at the problem that, you know, Cal She solves for the finance industry. You know, I mean, Chad, you were talking about it earlier. but, you know, if you're an institutional trader and you want to know, you know, what, how, like, the Trump presidency in 2016 is going to affect you compared to, you know, a Clinton presidency, how is that going to affect your portfolio, you know, you have to guess how, like, the SMP 500 is going to react. And, you know, you can just flat out get it wrong. A lot of people, you know, shorted the S&P 500 in 2016. And they ended up losing money because the S&P went up when Trump was elected. So, you know, now you can just hedge directly on that event and that possibility is open to ordinary people too, although how many people are actually using it to hedge at the retail level is an open question. It's always going to be a minority of traders. But, you know, this is the regulatory tradeoff.

And you can, this is like Hamilton Jefferson old, you know, how much speculation, you know, do you allow for the benefits of hedging for the small group of people? And it was really obvious when, you know, we were talking like early 1900s and, you know, trying to protect farmers who were starving and getting gouged by the railroads, you know, they needed some price stability and they needed some assurance of some steady and reliable income at a price that they could predict. But, you know, now you can do it on any event. And, you know, we're going to have to re-decide how we're going to balance those interests. Hey, it's us to Jonas Brothers.

And guess what? We have some big news. What's the news, huge news? We created our own podcast called, Hey, Jonas. We invented a podcast? Well, we didn't invent it. We just contributed to it. We're the first people to do podcasts.

Pretty, yeah, pretty wide range of podcasts throughout there. But this one's extra special. So how did we actually come up with a name, Hey Jonas, guys? I honestly don't remember. I think it was on a call about what we should call it. Well, we were thinking I'm originally calling it one of the early names of our band. Before Jonas Brothers was... This is how you guys remember it going down?

Yes. I have a very different memory of this. We were talking about a thing, a bit for the podcast, where people could call in and say, hey, Jonas. And then I wrote down on my little notepad, Hey Jonas, and offered it up as a potential title for the podcast. But thanks for remembering that, guys. Listen to Hey Jonas on the Iheart radio app, Apple Podcasts,

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Open your free iHeartRadio app. Search Learn the hard way and listen now. Chris, handicap this in another way, for lack of a better term. You know, you see a kalshi, you see a polymarket, you see a sport trade. do you feel like these can become something that have widespread appeal? Because right now it feels like the volume comes largely from market makers who are interested in playing in this space, experimenting in this space. Can they find, as you just mentioned, sort of retail success? Calhians Portrait, I think they can. the dream about sports is, you know, they're very numerous and high volume.

And, you know, ordinary people. If you go to, like, SBC, you know, every couple of years, there's a new panel on, you know, being the second screen during the game and that, you know, second screen engagement. Well, a prediction market is your second screen for anything you're mad about. You know, is there a story that pops up on social media that, you know, kind of hit you where you live? Well, you can go bet on that on Calci. Polymarket's going to be harder. If you're talking about retail success of polymarket, you're looking at widespread crypto adoption.

And there's a strong crypto community. And it's not that, again, it's not that polymarket isn't successful and that they have no future. That's not true at all. It's just, it's going to be hard to attract, you know, ordinary people. You're like, you're not going to get that 80-year-old guy in Alabama betting on Trump to win the election on polymarket that you will on Calci. So I think they're going to have to, polymarket is going to have to overcome that. Polymarket also has issues with their market resolution process. They just had another scandal this week in the market on whether Zelensky wore a suit to the

NATO side. Yeah, tell people about that because that's, you know, you're in this space neck deep. I'm in the space waist deep. And that controversy to me was the epitome of what are some of the issues with all of these things. Sure. So, I mean, the big question, if your prediction market is, you know, once an event has happened, how do you decide that it happened? money's on the line, in some case, hundreds of millions of dollars or hundreds of, yeah, hundreds

of millions. So, you know, you need a good process to, you know, decide when an event is occurred and how, you know, you're going to tell people that it actually happened. Cali does, what Cali does is they, you know, list their resolution terms under their market, and they will link to the, you know, kind of third party authority that they're going to use, whose data they are going to use to settle that market. So if you're betting, you know, or you're trading, you know exactly. who is going to, you know, make the call that, you know, we, you know, have an effective tariff rate of 6%,

whatever the market is. What Pollymarket will do, they have that same description, but it's a lot of reliance on, one, just a consensus of credible reporting, which isn't bad most of the time, but it also leaves this gray area. That's issue number one. And issue number two, Pollymarket uses a blockchain service. It's a product called the Optimistic Oracle. the UMA Oracle. And this is like a cryptocurrency. You can log it on Coinbase and you can buy, you know, the UMA currency. And you use that to cast a vote in Polymarkets markets and say, hey, I think the event has happened. I think the market should resolve this way or that way. And since it's based on how much UMA token you hold, how much of this currency you hold,

it's kind of this gilded age oligopoly now where a couple of very, very large traders can just take over the market. So, you know, their market-based solutions they're so proud of is, you know, it's not a free market, it's a market where like two, I think two traders hold just over half

of all the UMA tokens. So there's... This is ridiculous. It's not a good way to resolve markets. Now, the consequence of that, getting back to Zelensky's suit, after Zelensky's Oval Office confrontation with Trump and Vance earlier, it was earlier this year, covering politics is hard because there's just this time dilation.

Yeah, right? It was February. I still can't believe that was just February. Yeah. Anyway, after that, you know, one of the jabs in Zelensky was like, you don't even wear a suit and he's in, you know, military fatigues because he's, you know, mid-war. And, but he stepped down in the NATO summit with. with a suit that was designed by a designer who wanted to incorporate some military dress and things like that, but it was identifiably a suit. So the market on whether

so the polymarket market on whether Zelensky would wear a suit should have settled to yes. Instead, it resolved to know after several rounds of voting and dispute. And it's because these big UMA whales, these giant wealthy currency holders, were able to just, you know, cast all the necessary votes to resolve the market in a way that would get them more of their UMA tokens and more of their money. So that is, that's an ongoing issue that the Polly Market has. They did it, you know, late last year with like, will Israel invade Lebanon in September? Will they invade Syria by the end of the year?

Just a couple of these, you know, fuzzy terms like, what is an invasion really? And, you know, kind of which time zone are we looking at and some of these issues? these really big whales can take advantage of any fuzziness, you know, that the finest lawyers in the world, you know, kind of do in court. They use that same precision of language to try to, you know, try and resolve things their way. So, Polymarket has a structural problem that they really need to solve because this goes back at least as far as back as, you know, late last fall and certainly goes back further. Well, it's worth a billion dollars now. They can try to figure it out. Which is kind of insane, right? And that sort of speaks to a little bit late 90s and then with sort of the dot-com blindness and then speaks to social media euphoria and the investments that took place in places like Facebook, places like Twitter, the growth of something like Instagram to get bought for a billion when it barely had any users or was still, you know,

in a huge growth state. That's a lot of what this feels like, to me, between the Kalshys and the polymarkets, especially with the way they've been able to raise. And also, like, there's a day trading, sports betting, crypto, Manosphere, ethos, sort of a bro economy that exists now, that is helping to propel some of these things. I'm wondering if you're seeing some of that and you're reporting as well. I mean, yeah, you're always seeing the influencers get really excited about, you know,

prediction markets being the news. And, you know, in my mind, you know, the news is the news. You know, once a market resolves in real time, it's really cool. I was writing a story that included, I think it led with the big, beautiful bill vote, how individual senators were going to vote. And while I was writing it, the vote was happening. And I knew the vote was happening because, you know, Murkowski's odds, you know, spiked up to like 96% and Collins was dropping like a rock and, you know, I wasn't watching,

I didn't have C-SPAN in my corner because that wasn't what the story was about. And I didn't have it up. I thought I had like at least one or two more hours, to be honest. But now, that was, that was kind of wild to watch. And it, prediction markets give you a great state of the race. And I think they're still benefiting from, you know, how much earlier they called the race in 2024 and how much more of a lead they showed Trump having than polls did. But the forecasting piece of prediction markets is a lot more nuanced than the hedging piece. And there's a Columbia University economist who, you know, studied Polymarket 538 and the economist polls side by side for 13 competitive house races.

And Polymarket, you know, was never in first. Sometimes it was the least effective pulling mechanisms. So for these really smaller races, I think you can see polls do, my prediction is polls will do pretty well in the midterms compared to prediction markets. And then prediction markets will have another moment of glory in the presidential one where history is not as good a guide for forecasting, for forecasting the presidential election. Because you can get these, you know, I mean, Donald Trump's a French candidate in 2015.

He was, you know, I don't think a pollster would have necessarily predict. that Donald Trump would, you know, do really well in electoral politics before he came on the scene in 2015. But you test these new ideas and these new characters, the national level, and sometimes things take off. And prediction markets are really good at bringing that new information together where pollsters are relying on past history. So I, yeah, so I think there's going to be a lot more nuance that comes alive, you know, in the forecasting space in particular. And I don't know that that will dampen the enthusiasm for prediction markets, but, you know, I think they also benefit from, you know, kind of the self-sufficiency of financial trading to, you know, the idea that you can trade yourself and know the future better than everybody else. And, you know, be the self-sufficient man in particular. I mean, I grew up in Texas. I know what I know what those noises sound like. But it's also, I mean, those same things, those same beliefs are, you know, cognitive behavioral therapy for financial trading addicts. There's a professor in California who's on the front edge of trying to, you know, prepare, you know, gambling counselors as well to, you know, properly treat people who are using financial platforms

as, you know, gambling platforms and, you know, hiding behind, well, I'm investing. I'm not gambling, even though, you know, they're functionally gambling, even if their activity that they're choosing is regulated under this different umbrella. Simon, by the way, we've hit like the Nirvana for me, where we are talking about the geekiest, most technical stuff, and then throwing in cognitive behavioral science. I feel like I should just end the podcast now because it'll never be better for me. but I do remember for you, Simon, election night. I'm just settling down. My wife had insisted on inviting the neighborhood over for a freaking party for election night.

Everyone finally leaves. I'm sitting on my couch. I'm about to watch John King. Give me the results from Kalamazoo County. And you're texting me and you're saying it's over. And I'm like, what are you talking about? I'm just sitting down to watch the results. And you're like, check out the prediction mark.

markets. Yeah. Again, it's a different world where I don't know much about betting politics, but luckily I have people in my life that do it professionally. And these guys texted me at 830. I took an incredible amount of positions, bet a lot of money. I think I texted you right before about 9 o'clock and told you it was over and that the market was about to move an insane amount in the next 30 minutes. And you saw a live where it's like, our money. And, we're not comes in, the public follows that money because they don't know, they don't have the inside news like these guys do. And again, I don't know how they do it, Chad, but like you said, the predictive model of the markets is my favorite part of election night, that these guys know

three, four hours before the general public and all these news media outlets. It's one of the more interesting parts of the world we live in. And it's always fun picking those guys' brains that do it and how some of them can predict it a year or two hours. based on markets, money trends, and general public feel. And, you know, it's always going to be interesting. It's just a different world where we talk about action. One of our biggest nights as a company was, I believe, in 2020, right, with the election night. They crashed our site because we were updating.

The biggest traffic night ever. We kept updating the market, right? And where it was at? And people weren't going to Fox or CNN. They were coming to action to get the truth. And the truth was telling them, no, this is what the numbers is saying. who's going to win this election. So, yeah, I love it.

And again, this to me is why I hope these markets do last because it's just another tool to use and another way to make money. You're a great follow on Twitter at Gerlacher C. And this is really interesting stuff and really important stuff that I think is going to impact anyone who has an interest in this show

because it will become more accessible and available to people as complement potentially to what people are doing regularly with places like Draf Kings, fan dual fanatics, et cetera. Last question. You were just at, I believe, the Manifest conference about a month ago or so. Explain to people what that is and then tell people the most interesting thing

that was the most mind-blowing thing or the most, oh my God, if this really happens, it's a crazy thing from the conference. Oh, man. How to explain Manifest? Because I need Silver's new book, he spent some time just describing it. So Manifest is basically, it's half conference and half festivals. So it's this gathering of, you know, they're really trying to attract big name stars. So like, you know, Nate Silver, Jesse Richardson, at Political Kiwi on X.

He's a great political traitor. You know, David Shore, great progressive, Democratic pollster. Richard Henania, a very good conservative pundit. He's not an pollster, but he's actually a pretty good commentary. He's a libertarian who had to come to. a Jesus moment about Trump earlier this year. So he was interesting to watch. And he also did a really good job in hindsight

of predicting Donald Trump's rise. So anyway, you get people like that who are giving talks. And then you have all these, you know, really kind of quirky technical folks. The, the sex exploration people, the sex influencers like Ayala are also there. There's, you know,

it's all about body positivity and kind of intellectualizing of sexuality as well. So a lot of different intellectual spheres all come together at Manifest at this campus just off of Berkeley. And it's a really cool space and, you know, definitely worth, it was definitely worth going to for sure. But the most mind-blowing thing for me about that trip was the idea of the looming rise of AI traders and LLM traders. So, you know, LLMs can already, like Chachy, can research a trade for you and pull some sources and perplexity AI can, you know, give you some trading advice and do some research for you. We're getting very close to,

arguably within the next four years, according to at least one study I was shown there, of AI traders who match the accuracy of so-called super forecasters, people who are just very, very accurate traders beyond what experts and even what wise crowds can achieve. So the the rise of AI traders is going to have some hard questions. And I think the free to play and crypto platforms are going to have to deal with it first. Right now, every user should be a human trader on a regulated free money or real money site like Calci. Right. You can't have counterfeit people on there, even if you're using AI to assist.

But, you know, there's at least one star of there called Futur, another prediction market site. And, you know, they're already preparing their U.S. to have, you know, full. autonomous AI traders with their own accounts. So the AIAI wave is not just, you know, it's not just coming for the white collar jobs. Jobs are looking at traders too. Pretty soon betters. Yeah.

Chris Gerlocker. Fucking awesome, man. That was great. Follow Chris on Twitter at Gerlocker C. Check him out at prediction news. This is a fascinating space that people need to pay paying attention to. So thanks for jumping on, brother. appreciate it. The favorites

will return with our next episode of the show Tuesday. Action Network YouTube page, download us some Spotify, Apple Pods, whatever you get your pods. Rate, review, subscribe. Leave us five stars. Say whatever you want. Feedback is a gift. Until next time, love you. Action Network

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