I know this seems unbelievable, but I have a transcript of the discussion between Kalshi and the National Council on Problem Gambling (NCPG) that led to the prediction market giant joining the group that works to — in its words — “minimize the economic and social costs associated with gambling addiction.”
Here it is. It’s a real eye-opener:
KALSHI: Hi, we’d like to join the NCPG.
NCPG: Oh goodie! You do understand we exist to “minimize the economic and social costs associated with gambling addiction.” So you’re a gambling company, like our other members, such as DraftKings and FanDuel? Just sign here.
KALSHI: Oh no, no. Sorry. We’re not a gambling company. We’re a prediction market company. You know, like event contracts? I’m sure you’ve heard.
NCPG: Right. Of course. Apologies. But to be clear, people can bet on your site, yes?
KALSHI: No, they can buy event contracts. Look at me. Look at my lips. Eeee-vent connnnn-traaaacts. Much different. Let me try and explain: When you pick the Knicks giving 7.5 points on DraftKings, you’re placing a bet. When you pick the Knicks giving 7.5 points on Kalshi, you’re buying an event contract. You see the difference, right?
NCPG (after staring straight ahead for about an hour): Ah! Yes! Of course, Big difference. Let’s see here, what can we do … well, you’re like a financial firm in this regard, yes?
KALSHI: Bingo.
NCPG: Not a problem. Let’s whip something up here … how about we create a brand-new category specifically for this, call it our “Financial Services and Trading” subcategory, and we can all look like heroes!
KALSHI: Here’s $2 million.
Humpty Dumpty
So what really happened behind closed doors? Who knows. What I do know, however, is that this is almost certainly a positive development.
Kalshi should be applauded for recognizing its product — whatever you want to classify it as — has the potential to cause problems.
And the NCPG — which until yesterday had never partnered with any organization that is classified in any way with the “financial services and trading” industry — should be applauded for not being myopic and standoffish to any group that wants to join, no matter how they classify themselves.
So yes. Back slaps and attaboys all around.
But it’s also insane that we live in a world where these conversations and hoop-jumps have to occur.
Seriously: This is Alice in Wonderland levels of insanity.
Remember Humpty Dumpty? Of course you do. He fell off the wall, all the king’s horses and all the king’s men, etc. But he’s also the blueprint for what’s happening here.
Check out this passage from Through the Looking Glass …
“I don’t know what you mean by ‘glory,’” Alice said.
Humpty Dumpty smiled contemptuously. “Of course you don’t — till I tell you. I meant ‘there’s a nice knock-down argument for you!’”
“But ‘glory’ doesn’t mean ‘a nice knock-down argument,’” Alice objected.
“When I use a word,” Humpty Dumpty said in rather a scornful tone, “it means just what I choose it to mean — neither more nor less.”
“The question is,” said Alice, “whether you CAN make words mean so many different things.”
“The question is,” said Humpty Dumpty, “which is to be master — that’s all.”
To be clear, Kalshi and NCPG are both Humpty in this metaphor, and we’re all Alice.
Gambling? Trading? Rolling the dice? Taking a position? Call it whatever you want.
But the guy in Iowa down $600 at 1 a.m. sweating an international cricket match when he doesn’t know a wicket from a wombat isn’t “engaging in informational price discovery.”
He’s not “expressing a directional view via a binary event contract.”
What he is doing is looking at a money loss, and whether the app on his phone calls it a “bet” or an “event contract” is somewhere between irrelevant and insulting.
But the words aren’t irrelevant to the companies. The words decide who regulates them. The words decide which taxes get paid, which consumer protections kick in, which state attorneys general can come knocking — and, now and all of a sudden, which responsible gambling nonprofit will whip up a brand new subcategory just for you if you write a big enough check.
Which is to be master. That’s all.
Hold up a sec
But again: Bravo! I applaud this. I know I sound cynical bordering on angry as you read through this, but I’m not. In fact, I’m grinning like the Cheshire Cat because Kalshi joining the NCPG just brings the world one step closer to some common sense.
At the risk of sounding like Humpty myself, I am of the opinion that everything that is gambling is gambling. Including gambling. As well as gambling. Also: Gambling.
Sports betting? Gambling. Event contracts? Gambling. Retail stock trading? Gambling. Buying a box of baseball cards? Gambling. Loot boxes? Gambling.
And on and on and on and on.
Can you imagine a world where — instead of making words mean what we want them to mean — we instead all agree on the Cambridge dictionary definition of “gambling,” which is simply this: “the activity of betting money.”
Are you buying something with the express purpose of hopefully selling that same thing for profit? Congratulations. You’re gambling.
To me, this is obvious.
And this move by Kalshi and the NCPG may one day be looked back at as a pretty big building block toward my dream. Here is a company that is not a gambling company offering a product that is not gambling, but that sure does qualify as gambling under the Cambridge definition of gambling, that is joining a responsible gambling nonprofit that is now willing to stretch its own definition of what gambling is to include financial services, which is pretty much gambling while sometimes wearing a suit.
A lot of wordplay, a lot of linguistic gymnastics, but at the end of the day, what this deal is doing is bridging the gap between “gambling” and “gambling.” I’ll take it.
