Online and Sports Betting
Arnold Ventures is supporting rigorous, causal research and policy infrastructure to help decision-makers act on evidence about sports betting.
Legalized sports betting has expanded rapidly across the U.S., transforming from a niche activity into an always-on, app-based industry that reaches into the pockets of tens of millions of Americans. Critical questions remain about its financial, social, and behavioral impacts — and about which policy choices reduce harm.
As AV Co-Founder and Co-Chair, John Arnold has argued that the shift to always-on, online, phone-based betting and the proliferation of “micro-bets” (e.g., wagering on the next pitch) have changed sports gambling and increased risks for addiction and related financial harm. At the same time, prediction markets are expanding access to sports-related event contracts, raising urgent questions about which rules apply, who enforces them, and how consumer protections differ across systems. AV is investing in high-quality research and policy capacity, so decision-makers have clear facts and can set durable guardrails, particularly at the state level where gambling has long been regulated. And AV is not only funding that research, but working alongside partners in state capitals where we have supported the first wave of evidence-informed sports betting reforms, including Colorado’s SB-131, and on Capitol Hill to ensure that the people most at risk from predatory product design have the protections they deserve.
John Arnold on The Dangers of Prediction Markets
Arnold Ventures Co‑Founder John Arnold joined Liz Hoffman and Rohan Goswami on Semafor’s Compound Interest for a conversation on a wide range of topics, including concerns around sports betting and prediction markets.
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Why This Work Matters
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Policy is Moving Faster Than the Evidence
Sports betting is generating new revenue and changing how people engage with gambling, but the evidence base has not kept pace with the scale of legalization. Despite widespread adoption, we still know too little about individual- and household-level outcomes, including how regulatory approaches and consumer protections influence behavior and well-being. In the absence of rigorous research, state and federal decision-makers must navigate high-stakes choices without a robust evidence base. Early harms that are visible, from financial devastation concentrated among a small share of heavy users to elevated problem gambling rates among young men and college students, make the urgency of closing that evidence gap clear.
Prediction markets are reshaping sports wagering and deepening the evidence gap. Alongside traditional sportsbooks, prediction markets increasingly offer sports-related event contracts that function like sports betting but currently operate under federal commodity exchange rules rather than state gambling frameworks, leaving consumers without the protections that many state-regulated sportsbooks are required to provide. As these markets scale, consumer safeguards can vary across products and jurisdictions, making rigorous, causal evidence essential for decision-makers designing durable guardrails.
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What We’re Doing
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Funding Rigorous, Causal Research
In July 2025, AV launched a Request for Proposals to support rigorous, causal research on the impacts of legalized sports betting, with an emphasis on studies designed to produce actionable insights for policymakers, regulators, and advocates—especially at the state level, where frameworks are evolving quickly.
This RFP supports Randomized Controlled Trials (RCTs) and rigorous Quasi-Experimental Designs (QEDs) to help build strong evidence on the impacts of different policy and regulatory choices. Through this RFP, we recently awarded approximately $2.6 million to support 12 research projects examining the impacts of legalized sports betting in the United States. Learn more about the grantees.
In January 2026, we provided a $2 million grant to the American Institute for Boys and Men (AIBM) to launch a Sports Betting Policy Hub. The hub is designed to help policymakers, researchers, and advocates respond to rapid expansion and growing evidence of related financial and health harms, particularly among young men.
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Tracking How Prediction Markets Intersect with Sports Betting Policy
As prediction markets list more sports-related event contracts, policymakers and regulators need clarity on how these products compare to state-regulated sports betting, and what that means for state authority, consumer safeguards, and market integrity. Beyond building the evidence base, AV is actively engaged in the policy conversation, working with state and federal officials to support the development of legislative frameworks that help decision-makers close the regulatory gap between prediction markets and state-regulated sports betting and ensure that consumers have consistent protections regardless of how a product is labeled or regulated.
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What's Next
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Arnold Ventures Announces Additional Research Funding Opportunities
In July 2026, we announced additional funding opportunities to build rigorous evidence on the financial, social, and behavioral impacts of online casino-style gambling (iGaming) as states weigh whether and how to legalize and regulate it.
We are also continuing to examine additional opportunities to build rigorous evidence on the financial, social, and behavioral impacts of sports betting, with likely upcoming priorities including the evaluation of enacted state reforms, collegiate risk environments – including harms to student bettors and college athletes – and platform design and behavioral architecture.
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