Welcome to Breakpoint, a daily look at an ever-changing culture through the lens of unchanging truth. For the Colson Center, I'm John Stonestreet. Earlier this year, Warren Buffett sniped a Money magazine. It's tough to find values when everyone prefers gambling. His critique is not new.
Until recently, in fact, at least historically speaking, philosophers and theologians would argue that making money only off of investments was immoral. It's not difficult to guess what they might have said about the proliferation of legalized gambling, whether in casinos or online, or, for that matter, any of the attempts to call it by a different name. The most recent example, Calshi, an online platform launched a few years ago by two MIT grads.
Now, technically, Calshi is not a betting service; it's a derivative exchange, sometimes called a prediction market. Instead of placing bets by bookie in a casino or online, people trade contracts or shares that are tied to real-world events. Kalshi contracts can be on anything from political elections to financial exchanges to Oscar predictions. For example, just recently, Kalshi users could wager on whether Costco would raise the price of its hot dog combo because of inflation. One article described it this way: "Think of Kalshi as a marketplace where instead of buying stocks, you buy answers to future questions.
Every contract is basically a yes or no bet on whether something will happen." If you're right, you get a dollar. If you're wrong, you lose what you put in. End quote. And due to its incredible success, Kashi should be called more than just a prediction market. For media outlets, the collective wisdom of so-called investors on Kashi and its competitor Poly Market are often referenced by news sources as being legitimate predictions of future events.
And some small businesses have even taken to prediction markets to hedge against future risk. And according to CNN, over 1.4 billion dollars has already been "quote traded on prediction." Markets for next week's midterm elections. In just the past few years, the Koushi platform has handled over 52 billion dollars and now carries a valuation of over 22 billion dollars. That's more than many countries. Unlike traditional betting sites, the company takes between 0.07 percent and 7 percent of each tray.
So, as they say, the house always wins. And according to the letter of the law, Koushi is not gambling. Rather than state-level gambling commissions, Koushi's monitored. By the Commodity Futures Trading Commission of the federal government. Still, many government agencies and watchdog groups rightly see this as a distinction without a difference.
In Hawaii, for example, there are over one hundred thousand Kashi users. Though gambling there is illegal because of that and its effect on tax revenue, some state and local agencies have taken Kashi to court to try to settle what it actually is. Eventually, at least according to the company's CEO, such questions will have to be settled by the Supreme Court. The bottom line here is: with Kalshi, people put up money based on their predictions of future events. They're correct, they win.
If they're not, they lose. That is not investing, where one buys into a productive asset. It is called gambling. In his Sermon on the Mount, Jesus said, "Let what you say be simply yes or no. Anything more than this comes from evil." Contrary to what many have suggested, Jesus is not condemning oath taking here.
Instead, he's challenging what's known as caustistry. The habit of using fine distinctions and technical definitions to get around telling the truth.
So we might call gambling platforms prediction markets. We might call our bets investments, but that doesn't change what kashi is. Nor can our inventive language prevent the corruption it will bring, as more and more of life is subjected to so-called investments with so-called prediction markets. Just like widespread sports gambling has corrupted sports, the fan experience, even Sports Center on ESPN, so will prediction markets corrupt our elections. Even more, it will crew up users from being the kind of virtuous citizens that our society so desperately needs.
For the Colson Center, I'm John Stone Street with Breakpoint. Today's Breakpoint was co-authored with Dr. Timothy Paget. If you're a fan of Breakpoint, leave us a review wherever you download podcasts. And for more resources to live like a Christian today, go to Breakpoint.org.
Breakpoint listeners in Colorado, we're excited to invite you to join us for an event at Colorado Christian University with Dr. Christopher Watkins on Remaining Human in the AI Age on Monday, November 16th at 7 p.m. AI promises remarkable opportunities, but with them comes the risk of misshaping what it means to be human. Human beings are made in the image of God, endowed with a dignity we receive rather than manufacture. Dr.
Watkins will help us consider what this vision means for our use of AI, our relationships, our work, and worship, and for the challenge of remaining fully human in an age increasingly shaped by AI. Join us November 16th at 7 p.m. at Colorado Christian University. Register for free at ColsonCenter.org/Colorado. That's ColsonCenter.
org/slash Colorado.
