US investors bypass rules, sending $11–$34B into offshore prediction markets via Polymarket
A new research report says offshore prediction markets—despite being legally barred from serving US users—are still drawing large US participation. Total offshore prediction market trading volume is estimated at about $11B to $34B from Americans, with conservative figures attributing $11B to $27B to Polymarket. The report notes that by 2030, assuming stable market share, US users’ annual trading in offshore prediction markets could rise to roughly $133B (from today’s levels).
It also highlights the mechanics of the “bypass”: US users reportedly use VPNs to circumvent geographic restrictions, while blockchain-based platforms rely on reduced friction such as avoiding KYC (identity checks). Dune Analytics data cited in the report suggests 12.5% to 31.5% of US prediction market activity occurs on offshore platforms, and Polymarket alone accounts for up to 30% of that offshore volume.
On the competitive landscape, the report suggests a shift. CFTC-regulated US operators (including Kalshi) processed $74B over a 12-month period, with Kalshi taking about $70B, versus $85B combined for offshore platforms. This implies offshore prediction markets are growing but are facing increasing pressure from compliant domestic offerings.
For traders, this is more a sentiment and participation signal than a direct token catalyst, but it may influence perceptions around prediction-market infrastructure and potential regulatory attention.
Neutral
The headline is about prediction-market participation, not a specific crypto token or on-chain protocol upgrade. Still, it matters for traders’ positioning because (1) it reinforces that offshore prediction markets are successfully capturing US demand via blockchain rails and VPN workarounds, and (2) it signals potential regulatory friction as US regulators and compliant venues gain share.
Short-term, the data (offshore prediction markets taking $11–$34B and Polymarket dominating part of it) may boost “risk-on” sentiment around prediction-market infrastructure, but it’s unlikely to move major crypto prices directly. Traders may watch for headlines that imply enforcement actions or migration to regulated venues, which can affect perceived access, liquidity, and narrative.
Long-term, the report’s competitive shift—CFTC-regulated players (especially Kalshi) narrowing the gap—can temper the idea that offshore platforms are an uncontested growth story. This resembles past cycles where regulatory clarity and compliant alternatives slowly reduce the addressable base for offshore services, leading to a more balanced market structure rather than a sustained one-way bullish momentum.