Prediction Markets are becoming an emerging theme in AI product innovation across gambling, according to a report from the International Gaming Institute (IGI) of the University of Nevada, Las Vegas (UNLV).
Published in collaboration with U.S. tax and auditing company KPMG, the 113-page State of AI in Gaming 2026 is part of an ongoing initiative of IGI’s AI Research Hub (AiR Hub), aiming to set a benchmark for how AI is adopted and shapes the international gaming industry.
Key Takeaways
- Prediction markets and live-dealer products accounted for roughly one-third of AI-related product news coverage.
- AI is driving new product formats, including automated micro-contests built around real-time events.
- Live-dealer models face disruption from AI-driven virtual hosts offering scalable alternatives.
The IGI studied 151 news articles and other datasets on AI in the gaming sector and found product innovation is now a key area of analysis, with over a third of product publications focusing on prediction markets and live-dealer opportunities.
“When we analysed the trade publications in the context of AI and product innovation, two topics that were covered on multiple occasions were Live Dealer and Prediction Markets. With Prediction Markets, there’s a draw to Agentic AI technology to make autonomous decisions, like selecting events, creating markets, and settling outcomes,” Simo Dragicevic, cofounder of AiR Hub and the report’s executive editor, told Covers.
“For Live Dealer there is a very interesting development happening, where foundational models are beginning to take center stage in product development. We also noticed some senior talent migration to this emerging Live Dealer AI opportunity. However, at this point, it’s too early to state if this will disrupt the existing Live Dealer model or become a new vertical in itself.”
The IGI studied 115 regulators and 83 companies across the international gaming industry, highlighting gaps in the adoption and implementation of AI across the industry. One key finding was that while over 80% of the companies studied embraced some form of Generative AI - systems that generate and enhance content, far fewer companies had implemented Agentic AI, technology that can independently form plans, make decisions, and take actions.
The prediction markets product segment is one of the key drivers of AI innovation, leveraging not only relatively widespread Generative AI but also less common Agentic AI systems. For example, the study cites Slips, an AI start-up that leverages Agentic AI discovery tools to create “micro-contents” based on trending events, where the AI component of the system acts autonomously without human intervention, scanning for trends, creating markets, and settling outcomes. The report cites a partnership signed between Kalshi and xAI on Grok technology.
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Live dealers at risk of being replaced
Live-dealer gambling was identified as a secondary trend in the same category. The report said traditional studio setups could come under pressure from AI-powered virtual hosts, which are cheaper to run and remove physical constraints tied to human dealers.
It’s still unclear how this will evolve, the report says, as virtual hosts could either compete with live dealers or grow alongside them.
“Society is at an inflection point with AI, and until now there has been no rigorous, independent baseline for understanding where the gambling industry stands,” said Kasra Ghaharian, the report's editor-in-chief and IGI director of research. “The State of AI in Gaming is designed to fill that gap, serving as an essential resource for operators, regulators, researchers, and every stakeholder navigating the adoption, return on investment, and responsible integration of AI within the gambling industry.”
