Temperature check: alarm as prediction markets lean into weather and climate bets
Climate experts warn US Kalshi and Polymarket users are ‘gamifying disasters’ as they bet on events like heatwaves and daily temperatures
TL;DR
- Online prediction markets are increasingly offering bets on weather and climate events.
- Kalshi has partnered with the Weather Company to access data for verifying weather-related bets.
- The weather and climate betting market is reportedly growing rapidly, reaching $1.1 billion.
- Users can bet on a range of outcomes, including daily temperatures, climate-fueled disasters, and the severity of events like heatwaves and reservoir water levels.
- Climate scientists express concern that these markets 'gamify disasters,' leading to the dehumanization of climate impacts and distraction from necessary action.
- Proponents argue the markets can serve as financial hedges and contribute to forecasting data.
- Critics worry about perverse incentives, the potential for fueling conspiracy theories, and the obscuring of actual weather data.
- Platforms like Kalshi and Polymarket dismiss concerns, citing company policies and federal regulation.
- The prediction market industry faces increasing legal and regulatory scrutiny, with courts ruling that states can regulate them like gambling.
- Some studies suggest participating in climate prediction markets can increase concerns about the climate crisis and influence the views of climate deniers.
- Concerns remain that betting on climate can create a sense of a predetermined future and trivialize catastrophe and human suffering.