US prediction market betting surged past $1.48 billion during the 2026 midterm elections as traders on major platforms like Kalshi and Polymarket priced in a near-certain Democratic sweep of Congress, pushing the party’s chances of capturing both chambers close to 100 per cent.
Betting odds shifted dramatically after polling stations began closing at 6 pm ET on Tuesday, November 3, according to Reuters reports. By 9 pm ET, data aggregated by analytics firm BETINT indicated an implied probability near 100 per cent that Democrats would secure control of both the House of Representatives and the Senate.
However, with millions of ballots still uncounted, the implied sweep remained a market forecast rather than a confirmed election outcome. Reuters noted that over $4 million poured into last-minute wagers within minutes of polls closing, led heavily by Democratic backers, including a single $951,198 bet on Polymarket predicting a Democratic House victory.
Kalshi and Polymarket dominate midterms volume
According to figures from the Anti-Corruption Data Collective (ACDC) cited by Reuters, Kalshi reported $1.33 billion in trading volume across its midterm markets on Monday, while Polymarket recorded approximately $145 million in congressional wagers. ACDC tracked more than 28,000 individual midterm markets, though a concentrated number of races commanded the vast majority of trading activity. The Texas Senate race led the pack with nearly $67 million wagered as of October 29, followed by Michigan at over $26 million.
The explosive midterm activity builds on unprecedented sector growth following the 2024 US presidential election. Data from DeFi Rate covering eight exchanges shows that overall US prediction market volume hit $120.73 billion in October 2026, marking a 64.1 per cent increase from September’s $73.58 billion. Kalshi accounted for $98.15 billion of October’s volume, while Polymarket US registered $14.77 billion, combining to represent 93.5 per cent of total tracked volume.
High valuations accompanied the trading surge: Kalshi announced a $1 billion funding round at a $40 billion valuation co-led by Sequoia and Wellington Management on October 29, following Polymarket’s $1 billion raise in September at a $21 billion valuation. Macquarie has forecasted that full-year taker volume could reach $187 billion in 2026.
Market manipulation and regulatory battles
The record-breaking scale has renewed concerns over insider trading, market manipulation, and political integrity. Following April 2026 suspensions of congressional candidates who bet on their own races, and ACDC findings that modest wagers could swing market odds, both Kalshi and Polymarket defended their safeguards. Kalshi explicitly bans politicians and campaign staff from placing political bets, while operators maintain that prices reflect rapidly updating information rather than guaranteeing outcomes.
Simultaneously, jurisdictional friction between federal and state authorities intensified. On October 28, Utah Attorney General Derek Brown filed criminal charges against Kalshi and its co-founders, alleging promotion of illegal online gambling. In response, the US federal government and the Commodity Futures Trading Commission (CFTC) intervened on November 2, seeking a temporary restraining order and preliminary injunction to block Utah from enforcing state gambling laws against CFTC-regulated exchanges.
