A new study released to subscription customers of Bank of America Global Research shows an enormous market share gap between Kalshi and other prediction exchanges in the United States.
According to BofA, Kalshi trades encompass roughly 90% of the total US market, a probable determining factor in its recent $22 billion valuation. The platform is also widely recognized as the “first” federally regulated prediction market app in the country, falling under the purview of the Commodity Futures Trading Commission (CFTC).
By comparison, Polymarket, which has yet to fully roll out its US-facing prediction exchange to the public, is estimated to have approximately 6% market share, followed by Underdog. Despite Polymarket’s de-facto designation as the primary rival to Kalshi, it does not currently allow trades in USD – running exclusively on blockchain technology.
The subscription-based research contains a section dedicated to Underdog, which acquired Aristotle Exchange earlier this year. Although it originally partnered with Crypto.com for sports-related event contract trading, the company plans to launch its own sports trades by the start of the 2026-27 NFL regular season, according to the BofA research paper.
Additionally, the analysis shows that Underdog is currently in a close race with Polymarket for the second-place position in terms of market share. The popularity of prediction market exchanges in the US has soared in 2026, with multiple reports pointing to increased trading on sports contests – an activity that is expected to continue its upward trend leading into the collegiate and professional football seasons by late summer.
The sheer invigoration displayed by funding firms and angel investors who are seemingly lining up to partner with prediction exchanges provides a sharp contrast to the in-the-trenches legal battle surrounding sports contracts that has caused such a legal uproar throughout the nation. At current count, 18 states have entered their own queue with the aim of extracting value from platforms including Kalshi and Polymarket.
Many states are insisting that sports-related contracts offered by prediction markets are violating jurisdictional gambling laws while eating away at sportsbook tax revenue made possible through state-sponsored licensing of apps such as DraftKings, FanDuel, Bally Bet, and BetMGM.
Most recently, Minnesota passed an outright ban on prediction exchanges that goes into effect on August 1st. Kalshi, along with the CFTC has filed legal actions to block the state prohibition, which criminalizes all operational activity tied to the platforms.
In the meantime, the BofA report highlights just how important Kalshi’s status as being the “first to market” as a regulated prediction market service has been in terms of overall market share. Under the CFTC, Kalshi has managed to capture more trading activity – by percentage – than the once-offshore PokerStars peer-to-peer vertical enjoyed before the 2006 UIGEA was enacted.
The eventual framework of the US prediction market space could still take years to take shape. Despite the push-pull relationship between gaming interests that could result in multiple conflicting pieces of legislation being passed before the end of the calendar year, the parallel court battle is likely destined for a Supreme Court showdown in 2027, according to many legal experts.
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