Billionaire Says Prediction Markets Akin To Drugs
David Booth, who founded a firm now managing more than $1 trillion in assets, said prediction markets and their gambling offerings are a bad idea, comparing them to drug use.
In an op-ed for the Financial Times, Booth, 79, wrote: “I feel about prediction markets the way I feel about drugs — they’re probably not a good idea. Prediction markets […] are just the latest example of people being taught to view every uncertain outcome as an opportunity to place a bet.”
His comments come as sports betting becomes increasingly controversial among Americans.
Digital Las Vegas
Booth, the founder and chair of the Texas-based Dimensional Fund Advisors, said the gambling platforms give young people “an instant rush” and are like buying lottery tickets. He added that these gambling sites are a “zero-sum game,” like going to Las Vegas and playing roulette.
Meanwhile, prediction markets have advertised or promoted their sports gambling products as investments. According to a Bank of America sports betting survey, 20% of respondents consider betting a type of investment.
Gen Z is twice as likely to view sports betting as a form of investing.
Insider Betting
“Not only are the odds stacked against you, there are insiders tilting the scales,” the billionaire added. “You’re also often up against professionals with vast research resources, and there’s little transparency to ensure a level playing field. This system really is rigged.”
While the CFTC, along with prediction markets, has caught and taken action against some cases of blatant insider trading, these enforcement actions likely represent only the tip of the iceberg.
If you trade in a gambling market vulnerable to insider trading, you assume significant risk.
Billionaires Piling On
It’s particularly notable when a billionaire directly criticizes prediction markets and sports betting.
Booth’s comments echo a similar critique of the sports gambling business by billionaire Warren Buffett in a recent interview with CNBC. The famed investor believes that states shouldn’t have legalized it.
In a 2025 interview with the Institute for New Economic Thinking, billionaire investor Jim Chanos said sports betting has helped make the U.S. “a bit of a casino society.”
Billionaire John Arnold, founder of Arnold Ventures, has also been a vocal critic, and his group recently announced millions of dollars in funding for studying the harms associated with sports betting.
In the public health space, former U.S. Surgeon General Jerome Adams called sports betting the “new opioid crisis.”
Image via wealthmanagement.com
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