John Arnold, founder and co-chairman of Arnold Ventures, at the George R. Brown speaks during a session of CERAWeek by S&P Global at the convention center.
Yi-Chin Lee | Houston Chronicle | Hearst Newspapers getty images
Billionaire philanthropist John Arnold says online sports betting has changed significantly since it was legalized in the US in 2018, thanks to online prediction market platforms Kalshi and Polymarket and mobile apps. draftkings And FanDuel. To better understand the potential risks, he is awarding $2.6 million to researchers studying the emerging world of sports gambling.
The grant, which has not been previously reported, will go to researchers at universities and think tanks to look at the impact of gambling on financial well-being, household formation, mental health and consumer behaviour.
Arnold, who co-founded Arnold Ventures Along with his wife Laura, he told CNBC that he wants lawmakers and regulators to be aware of the new reality of the rapidly growing sports betting market.
“Being able to place betting over the phone has dramatically increased access and reduced friction,” Arnold told CNBC. “It’s changed what the product is. You can bet on every pitch. You can bet at a speed that was never possible when you had to call to place bets.”
Arnold, a former hedge fund owner and Enron energy trader whose philanthropy has worked on criminal justice reform and reforming higher education, has recently turned his attention to the potential harms of prediction markets and sports gambling apps, meeting with lawmakers and pushing for stronger guardrails.
Schools including Princeton University, the University of Pennsylvania and the University of Wisconsin will receive Arnold grants for research over the next three years, Arnold Ventures said in a press release.
A 2018 Supreme Court decision paved the way for sports betting to be legalized in the US, which has since seen participation grow over the past few years. April 1st Survey by the Research Institute of the University of Sienna Found that 27% of Americans have an active online sports betting account, up from 19% in 2024.
Sports betting industry breaks records Revenue of $16.96 billion in 2025The American Gaming Association announced it earlier this year. And trading volume on the top two forecast markets – Kalshi and Polymarket – has increased from less than $5 billion in September to nearly $24 billion in April, according to a Analysis by Pew Research Center.
Sports are the most popular type of event contracts by volume on prediction markets, which operate uniquely and are subject to a different regulatory authority than traditional gambling sites. As of February, about 87% of bets placed on Kalshi last year were on the game, according to Congressional Research Service.
twenty nine statesAlso the District of Columbia has legalized sports betting since 2018.
“A lot of states jumped into legalizing sports betting in 2018. And I think they were very attracted by the potential tax revenue,” Arnold said. “It is very attractive for a state legislature to get money from a voluntary tax rather than a mandatory tax.”
He added, “But our argument is that there has been a dramatic change in both the intensity and the reach, not only for sports betting but for many other vices.” “As legislators are thinking about what we do with it and whether we legalize it, there needs to be a realization that this product has changed.”
Arnold compared the maturity of online sports betting to marijuana legalization and the growth of pornography.
“Marijuana today is a very different product than it was a generation ago. The intensity is much higher and the reach has increased,” Arnold said. “You think about pornography. The intensity of the product has increased dramatically, the ease of access has decreased dramatically.
“So sports betting, obviously access has increased dramatically, but the product has also changed.”
Arnold Ventures in 2025 funded research grants Studying the effects of legalized marijuana.
The reach and intensity of sports betting has also increased. Any user can place multiple bets on the same game without leaving the sofa. According to a Ciena survey this spring, forty-six percent of men between the ages of 18 and 49 are punters, and critics argue This can have negative financial impacts on young men.
The issue has drawn the attention of lawmakers on Capitol Hill, where a flurry of proposals have been introduced since the beginning of the year.
Some, like Senator Jeff Merkley, D-Ore., and Representative Jamie Raskin, D-Md. The bill, introduced by , would ban prediction market program contracts on sports, elections, war and government actions. Another from Sens. John Curtis, R-Utah, and Adam Schiff, D-Calif., specifically wants to bar prediction markets like Kalshi and PolyMarket from allowing sports wagering on their platforms.
Meanwhile Sen. Richard Blumenthal, D-Conn., and Rep. Paul Tonko, D-N.Y. The legislation attempts to create stronger guardrails for online sports betting by empowering states to make their own laws, restrict advertising, and ban certain types of prop bets, which place bets on a specific event or figures within the game, as opposed to the final outcome.
Arnold has met with lawmakers on Capitol Hill about the issue, but most of his efforts are directed at the state level, where sports betting is regulated. Prediction markets, which feature peer-to-peer contracts for bets against the house, are federally regulated by the Commodity Futures Trading Commission.
“We are very actively talking to state legislators about their decision to legalize, as bills to legalize are coming through state legislatures every year,” Arnold said. “And there are people who have already legalized and are thinking about the right guardrails.”
Disclosure: CNBC and Kalshi have a commercial relationship that includes client acquisition and minority investment.