We’re back for another Monday Morning Betting Hack, except, well, it’s Tuesday. That’s because this weekly review, preview, analysis-thingy respects workers. Betting Hack will return to its regularly scheduled Monday morning time slot next week. In this house, we respect federal holidays.
Look, we all thought the game was over.
I thought it was over. Western Michigan thought it was over. Dave Portnoy thought it was over.
“I definitely thought the game was over because there were zeroes on the clock,” Michigan QB Bryce Underwood reportedly said.
IT’S A MIRACLE!!! WESTERN MICHIGAN TAKES DOWN MICHIGAN IN ANN ARBOR!!!!!!!!!!!!!!! pic.twitter.com/yJTLHUPHf0
— Mr Matthew CFB (@MrMatthew_CFB) September 6, 2026
In that context, I now note that Kalshi thought it was over, too. The prediction market operator began paying out Western Michigan backers on Saturday night after a seemingly huge upset over Michigan. Except, well, another second appeared, another down was played, and Michigan won on a literal last-second Hail Mary, 13-12.
The college football game had attracted $18.6 million in trading volume via Kalshi’s exchange. When it was clear that Western Michigan had officially lost, CNN’s Marshall Cohen reported that Kalshi clawed back winning payouts, reimbursed initial losers, and then issued new winning payouts.
(Coinbase claims it was affected by Kalshi's "erroneous settlement" as well. However, Coinbase is apparently letting the initial winners keep their winnings, while also paying out the initial losers.)
a real rollercoaster of contract settlement for WMU-MICH:
— Geoff Zochodne (@GeoffZochodne) September 6, 2026
yes-no
no-no
no-yes pic.twitter.com/ww8w7f7sNc
Maybe here you could say, hey, mistakes happen.
If you read the full rules of Kalshi's event contracts for the game, one of the "source agencies" for determining the outcome can be "the official broadcaster of <football game>."
That broadcaster, NBC, also thought Western Michigan won. That’s why they threw up a "Final" on their scorebug Saturday night, right between the 12 for Western Michigan and a 7 for Michigan.
Prediction markets are >80% sports/parlays. So the start of college football is HUGE. But there were big stumbles this weekend — a Polymarket outage while games were underway, and then Kalshi paid the wrong winners of the disputed Michigan game. here's our report w/ @OmarJimenez pic.twitter.com/1F1AiDPsGo
— Marshall Cohen (@MarshallCohen) September 7, 2026
So, nobody's perfect, right?
Right. Because Polymarket, Kalshi’s biggest rival in the PM game, ran into its own issues on Saturday. The company’s CFTC-regulated app had an outage in the thick of college football trading, prompting Polymarket to refund losses, let wins stay wins, and pay out bonuses to smooth things over with its customers.
Again, pobody is nerfect. Except prediction markets may not be in a position these days to expect much grace or patience from certain folks (which might explain the generosity after Saturday's issues). They are moving fast and breaking things. When they stumble, it's news.
According to Aldrin Research, there was $2.67 billion in notional trading volume for federally regulated prediction markets on Saturday. It was the biggest day for the exchanges in the past three months, a period of time that also included the World Cup.
Furthermore, the American Gaming Association is estimating that around $29.5 billion will be wagered on the coming NFL season with state-regulated sportsbooks. That estimate indicates no growth from last season, and the AGA has a chief suspect for this flatlining.
“Since the widespread launch of backdoor sports betting on so-called ‘prediction markets,’ the growth of legal handle has stalled,” AGA President and CEO Bill Miller said in a press release.
So while sports event contracts are relatively new, they are proving to be popular, and their trading is happening over the objections of the state-regulated gambling industry. That is why any of the above is notable and being covered on CNN: if prediction markets were old and insignificant, we’d probably care less.
This state of play means there are going to be people who are loathe to cut prediction markets some slack. For proof, look no further than another bit of prediction market-related news that broke over the weekend.
Underdog CEO Jeremy Levine said on Saturday that they will be shutting down their fantasy draft games in seven states right after the NFL kicks off on Wednesday. This, Levine suggested, was because those states made them choose between state-licensed fantasy sports or federally regulated sports prediction markets.
“Those states have taken a legal viewpoint we disagree with: if we offer our CFTC-licensed products we cannot offer fantasy sports in those states,” Levine said. “So we had to choose. We could keep our fantasy licenses in those states, or surrender the licenses and offer effectively our full experience, minus Drafts.”
Drafts community, I have some not fun news to share. Right after kickoff on Wednesday, we will be shutting down Drafts in seven states: MA, MD, MI, MS, NJ, PA and OH. Already entered drafts will continue as normal, but in those states you won’t be able to enter new drafts. If…
— Jeremy Levine (@JerLevine) September 5, 2026
Underdog, which began as a fantasy sports company, chose prediction markets. That's a tough choice, but this is now a very tough business.
State gambling regulators want to shut down sports prediction markets, rival exchanges want to boost their market share, and traders want what they want when they want it.
That all just means there may not be a lot of forgiveness to be found these days for mistakes, well-meaning or otherwise. And that is, as they say, life in the NFL.
ICYMI:
- New Jersey Seeks Supreme Court Review of Sports Prediction Market Case
- STX’s Springboard: Ontario iGaming Experience Fuels US Prediction Market Push
- LeBron James Teases Partnership with Polymarket
- Connecticut Sues Kalshi, Seeks to Ban Sports Event Contracts
- Other States Seize on Nevada’s Prediction Market Triumph
- College Football Prediction Market Trading Exceeds $790M in Week 1
Other news worth knowing
– Speaking of the NFL, the regular season starts on Wednesday. Our betting analysts have the Super Bowl rematch covered from a bunch of different angles.
– The New York Racing Association’s Saratoga meet finished up on Sunday, which is, to me anyway, the real end of summer. There’s some betting news as well, namely, that NYRA has been more restrictive with computer-assisted wagering groups, and it might be helping attract more retail bettors.
“In an environment with strong content we have seen an uptick in the retail cohort, an impressive one actually that outpaced what even our most optimistic projections would have been in the timeline,” NYRA CEO Dave O’Rourke told Daily Racing Form. “This is something that could potentially take years to right size or get back on track, but improving the wagering experience has shown some meaningful positive green shoots here.”
– Michigan’s near-disaster probably helped most people move on from the biggest FBS upset since 2021, which was Rutgers losing to UMass on Thursday. BUT I HAVEN’T FORGOTTEN:
The biggest FBS upset since Kansas over Texas in 2021, according to ESPN Research. https://t.co/IA9FVG5nmJ pic.twitter.com/ioh6QNO3Ki
— Geoff Zochodne (@GeoffZochodne) September 4, 2026
