Why are people allowed to bet on the likelihood of the United States attacking another nation? How can one person profit over $500,000 by predicting the death of the Ayatollah? Doesn’t something about that feel….wrong?
In this week’s episode of Offsides, Pablo and Jen discuss the dystopian reality of prediction markets—such as Kalshi and Polymarket—taking over the world of sports and politics. The two also discuss Trump’s upcoming panel which will focus on the future of college athletics. Ironically, no student athletes are invited.
Pablo Torre is an American sportswriter, podcaster, and television host. He contributes to various programs at ESPN, including Pardon The Interruption and Around The Horn. Keep up with Pablo on his Substack and podcast Pablo Torre Finds Out .
The following transcript has been edited for formatting purpose.
Jen Rubin:
Hi, this is Jen Rubin, editor-in-Chief of The Contrarian. If it’s Monday, it must be Pablo Torre. Pablo, welcome!
Pablo Torre
Jen, good to be back. We missed you last week. I missed you last week due to general travel and incompetence, but I’ve now stored up a lot of takes for you!
Jen Rubin
It is good to have you. Before we get to our main events, I have to say, we should send our thoughts and prayers to Shane Lowry, who, of course, is the Irish golfer who completely choked away on the final round of his tournament. He had double bogeys on two consecutive holes, and it felt like one of those golf movies, you know, where the guy keeps hitting it in the water and hitting it in the water. Before we get to the main part of our program, how do you explain something like that? Do you just… you think it was nerves? You think he just, like, checked out? How do you explain that?
Pablo Torre
He joins a long and distinguished tradition of people losing what seems to be basic motor functions under high pressure. environments. Look, I don’t think that you need an explanation beyond, this happens, and the human brain has a remarkable capacity to, when it is autonomously and automatically functioning, it looks so easy.
And then, when you think about it too much, or you struggle against it too much, and this is literally the psychology of the yips and of choking, when you’re aware of what you’re doing too much, it all falls apart. Yeah, I just think Shane Lowry, you know, the consolation is many great golfers have struggled along these lines. And the greatest ones are not defined by it, and are not haunted by it, but God knows any normal person will be.
Jen Rubin
Exactly, exactly. So, Shane Lowry will have better days. So let’s talk about insider trading, insider betting, Frankly, it’s obscene, but we had people placing last-minute bets on the beginning of a war. And raising the question as to whether there is any control on inside information, any consequences, any regulation. What’s going on in that whole realm, Pablo?
Pablo Torre
Yeah, I mean, look, so there’s a lot happening in this, in this field right now. The prediction markets are at the forefront because… apparently war in Iran, the death of, world leaders, these are all things you can… you can bet on. I always remind people that Donald Trump Jr. is on the board of both Polymarket and Kalshi. Both. And that’s not because, wow, he’s such a brilliant figure that he must work for both competitors in this field. It’s because the entire premise of what this is, this prediction market, aka legalized sports gambling but for everything business, this industry, it relies upon the good graces of the federal government. And so the CFTC is what is ostensibly here to regulate this, but really, Donald Trump’s CFTC is regulating this to unchain it.
The CFTC has deemed these event contracts, aka bets as commodities, and they are totally loosening the reins on our ability to, to bet on this wherever and whenever we want, it seems. With the states being left to push back and saying, actually, this is like sports gambling, and we know this because 90% of your customers are using it for sports gambling, and therefore they should be regulated by the states like sports gambling. And so that’s a fight happening in courts right now. Yeah. But I mentioned the Donald Trump Jr. stuff because, as always, if you’re a normal American who’s putting money on any of these event contracts, will Iran be, whatever, be bombed by March 1st, or other ones like that? Will Venezuela be invaded, et cetera, et cetera? The question you should ask yourself is: Who else is putting money on this, and why are they doing it?
Because insider trading, Kalashi says we regulate it, polymarket does not have a policy in the same way, but the same concern emerges, which is, are the people winning in this field. people who have inside information via the Donald Trump Jr. and Donald Trump Jr. adjacent characters that populate these networks, that have knowledge. And that’s why they’re putting money on it. The question really is, when you put money on a prediction market, do you think you personally, average American, have an edge? of information. Because I guarantee, and it seems very metrically clear, that there is a population of people who do. So, why would you want to compete there? But, look, Jen, I think you’ve paid some attention to just the way that sports are being ravaged by legal sports gambling in just the conventional, the more conventional way, right? Not in prediction markets, but just like DraftKings and FanDuel. And that stuff is sort of the ghost of Christmas Future here. Because in these ways, you have not only given the ability for insiders to profit. But you’ve also given an incentive for insiders to arrange the manipulation of behavior.
Jen Rubin
Exactly. And in the case of war, you are getting people to perhaps encourage wars so that they can make a buck in the prediction market? That’s… The universe we’re talking about.
Pablo Torre
Well, and so you take the sports metaphor, right, and you think about it, because the episode we did of Pablo Torre Finds Out last week was about how the NBA gambling scandal was born. And we unmasked this co-conspirator, co-conspirator number one, and it’s this obscure NBA player named Antonio Blakeney. And the reason why it’s important that he’s an obscure, quote-unquote, at times NBA player, as the federal government called him. Was because in every one of these circumstances, both basketball games and war, the question to ask yourself is, who else has inside information here? And the list is so much longer than just the cabinet members, right? The list goes to any number, especially when it’s… Again, this administration, and they’re just leaking everywhere.
It’s obscure people who are trading on this stuff, who are benefiting from this stuff. And so in the NBA gambling scandal, what happened was… an NBA player, who was very obscure named Antonio Blakeney, was now playing in China, and he was somebody who these, these now co-defendants In this gambling trial. This is the person they leaned on to help manipulate games in China. They experimented with it in the Chinese Basketball Association. One of them had this amazing quote, death, taxes, and Chinese basketball, as the most predictable, reliable ways, you know, of engineering gambling winnings. And so Antonio Blakeney was a player, and he was in on it, and he allegedly profited, and allegedly benefited. And so they took that… And they imported it, basically, to America. Because in the legalized gambling era, in America, you can bet, legally, on the Chinese Basketball Association, which, again, is kind of like betting on the war in Iran. It’s sort of like… why… why is this able to be bet on in America? And the people making the biggest bets, why are they doing it if not to benefit from inside information about the outcome of these?
And so they took the Chinese Basketball Association scheme into America, allegedly, and they piloted it in Asia, and did it then to the NBA. And so, everything that’s happened since, it started with these obscure characters realizing, wait a minute, this isn’t that hard. We have information, we have insiders, and we have a legal mechanism to place bets. That’s all you need. And so, it’s sort of astonishing that it starts abroad, is brought to the NBA, to America, and they do it over and over and over again on NBA games. And at that, allegedly. And at that point. what I thought was about the broader picture of, like, how do you ever regulate this? How do you stop it from happening? How can you prevent information when anything Can be currency. Because actionable information in a betting market where anything is a bet, right? It’s, like, under rebounds on obscure NBA players. It’s random event contracts on government decisions. Everything can be profited off of, which means that nothing can really be regulated.
Jen Rubin
You know, it is a morass, but I think one of the things we’re experiencing, whether it’s in the betting area or other changes that we’ve started, is the answer is not the Wild West. The answer is not. let the… Let everyone be aware, because we have unequal positions. And so long as you have people who are let’s say, a questionable character, in positions of power, it’s going to get corrupted. And I think this is a perfect example, we’ve seen it over and over again in lots of other contexts. Congress needs to do its job, states need to do its job, and they need to be able to get their arms around it. And there may be things that we try to outlaw entirely. Sure, they go underground, and there’s some market for them.
There must be, you know, with AI, we’re going to be able to detect this as quickly as it happens, but we can’t simply throw up our hands, because it’s not only corrupting sports, it’s potentially corrupting wars, and corrupting major government decisions, and people’s lives, and it seems like we have really gotten to the level of absurdity when people are betting on the start of the Iran war.
Pablo Torre
Yeah, I think what you’re trying to do is balance out, or to mitigate the incentives, which are now very, very obvious and very accessible. And I do think, look, if Congress was awake. Right? If we had a federal government whose regulatory agencies wanted to put teeth behind their declarations against insider trading. You could punish this stuff and try to deter this stuff such that that cost-benefit analysis might tilt away from just this wild west, which we currently exist in. But you’re right, like, I… militarily, I also just think it’s worth saying this. There’s another side effect to this, which is, as prediction markets become a vector for people to get information. and news, right? They’re now turning to this as prediction, right? That’s what the power of it allegedly is. You’re also legitimizing future outcomes before they happen by saying, this is, by a percentage chance, going to occur. And when you have a market that is telling you, here’s what the future is like, but that future is literally being shaped by money. that is being bought by anonymous accounts, you’re not only creating a vector for corruption and quid pro quo and insider trading stuff, you’re also fundamentally… creating, and I hate to use an overused word here, but you’re creating a dystopia where people are preparing for things that those with disposable income can create for them. And that’s just especially crazy crazy to me.
Jen Rubin
Absolutely, and I think that is beautifully described, and it goes to the fundamental issue. We have free will. We’re a democracy. It’s not supposed to work this way. It’s not supposed to be that we accept outcomes because someone has bet on something and then has a vested interest in making sure it comes to fruition. So, this suddenly got very, very meta, Pablo. I mean, we’re like, whoa, yes, very, very scary stuff.
Let’s talk about something that’s scary, but at a lesser level of scary. And that is Donald Trump wanting to talk to college, football. what is this about? Why would they even sit down with him? What could possibly go wrong with this?
Pablo Torre
Just everything. I think everything could go wrong with this. So it’s the Saving College Sports Roundtable. And it’s happening later this week, supposedly, and it’s dozens of these characters from around sports, and some of them make some amount of sense. It’s like, oh, there’s Nick Saban. And there’s Mack Brown, the former coach at Texas and North Carolina. But then it’s just… I’m just looking at the list right now, and it’s like, there’s Ron DeSantis.
There’s Tiger Woods. You know, there’s a bunch of… Condoleezza Rice is always at a… any good sports government panel. you know, it’s, lots of heads of media companies, sports rights holders. I will say that The reason why any of these otherwise respectable people are participating is obvious, and it’s because when the president calls you to the White House under this administration, there is a real economic upside to playing ball.
I’m not shocked that everybody who runs a business has decided I, too, will help normalize this insane person that is currently running roughshod over planet Earth. Cool. I’m ready for that part, I guess. What is not in any of these lists, though, are any active college athletes. Which is just funny. And nor are any agents, by the way, for these athletes.
It’s basically labor is not represented in any meaningful contemporary way. And so, from that perspective, it’s like. Whatever they decide will be missing this enormous, enormous, and maybe the most important perspective of all, as they all decide how to save college football, but we’ve also seen many of these councils and panels threatened before by the government, and nothing ever happens, so there’s also just that.
Jen Rubin
This is so typical of the administration and of these, NCAA… leaders that they still think that they’re just gonna tell everyone what to do. That you don’t need the little people. You don’t need the people who are actually creating the wealth. You don’t need the people who are actually the talent, just tell them what to do. that fundamentally, I think, misunderstands what we’ve seen in sports, which is the talent is king. And it always has been, and if you look at whether it’s baseball free agency, whether it’s NIL money, however way you slice it.
You cannot run these sports without fairly and fully rewarding the talent. And the fact that they’re going to set up some system because Donald Trump thought it was a great idea is just madness. And it’s this arrogance of. the oligarchy, I mean, the only thing more perfect would be if you had FIFA in the room, and they were there too. Because, like, let’s get all of the bigwigs who really are figuring out ways not to reward the people who deserve it, and put them in a room together, what could possibly go wrong?
Pablo Torre
Yeah, and it’s also worth noting that the athletes are the ones who have filed these lawsuits that have resulted in all of the change. And so, from a pure, just like—I don’t know, don’t you want to tell the story of how we got here? You kind of got to turn to these class-action suits that have represented many, many, college athletes of yore who were not paid, and so now you have this—I should be clear, I think college sports are currently a mess, and they are in dire search of leadership, and something resembling a principled.
But organized vision for how to regulate and set rules around how do we pay athletes, how do we fund non-revenue generating sports? How do we make it so that the notion of going to college is not totally erased from the premise of college sports? These are all reasonable, I think, concerns. The transfer portal is a mess. All of this stuff is… I get where people are coming from. I just have zero faith that this is anything but. one of those FIFA-style summits, where it’s like everyone presents the president with a trophy. Like… what evidence do we have that it’s gonna be anything but that?
Jen Rubin
It is, you know, corruption in a prom dress on steroids, and that’s kind of the story of this administration. I will close on this, because we keep coming back to it and back to it again. I guess Iran won’t be playing in the World Cup, or… I mean. This is what you do when you give a megalomaniac with a… military force that is second to none, the award on peace, that you find yourself in situations like this. I mean, the Peace Prize, really? Really? Even for FIFA.
Pablo Torre
It’s just… I mean, it’s all… I… there are so many ways to look at this story and see how self-interest was prioritized over anything resembling, a national or international interest. The fact that we have to pretend, though. that Donald Trump was ever in… remember when he campaigned against ending foreign wars?
Jen Rubin
I know, yes, we have to pretend that that was legitimate, yes, exactly.
Pablo Torre
Epstein files, foreign wars, the economic well-being of the average American. I don’t know if there are 3 more opposite missions that Donald Trump has been on, and those specific three, yeah.
Jen Rubin
Exactly, exactly. And I think, I hope, I hope that just as the American people slowly, slowly wake up to the fact that maybe it’s not a good idea to have a secret police running around the country throwing people into concentration camps, that they will wake up to the larger problem, which is, this isn’t what they voted for. And sending people into a voluntary war for one guy’s delusional reasons is probably not the way we want to run our democracy. But we will leave that for another day, Pablo.
Wow, interesting stuff. Have a good rest of the week. We can only imagine what will come out of that Donald Trump, meeting. I can imagine… can you imagine the loot they’re gonna come, though, with the swag they’re gonna be giving him, you know Suddenly, there will be a lot of college stadiums named after Donald Trump. God forbid. God forbid. Pablo, be well. Always good talking to you. Have a great week. We’ll see you next week. Bye-bye.
Pablo Torre
Thanks, Jen.
