[Opinion: U.S. Prediction Market Booms Amid Bubble Risks: Regulatory Game and Liquidity Bottlenecks as Key Variables] Odaily Planet Daily reports that analysts point out the prosperity of the U.S. prediction market is built on an unstable foundation, primarily benefiting from regulatory arbitrage opportunities. For instance, many U.S. states currently lack comprehensive systems to regulate users participating in sports betting through prediction markets. According to Dune Analytics data, by 2025, sports-related trades are expected to account for approximately 85% of Kalshi's trading volume and about 39% of Polymarket's. Devin Ryan, Head of Financial Technology Research at Citizens Bank, believes the market needs to establish robust integrity rules, and the trading volume of non-sports markets needs to increase. Currently, the market size for predicting January CPI inflation data on Kalshi is less than $1 million, while the market size for predicting core inflation is less than $30,000. Such low liquidity is insufficient to attract institutional participation. Moreover, the U.S. prediction market currently exhibits characteristics of a "fragile boom," with growth primarily relying on regulatory gray areas and significant marketing investments. If regulations tighten or user interest wanes, growth could face pressure. On the regulatory front, there is also some contention. For example, U.S. prediction markets often claim they fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC) as event contract trading, but state-level regulators take a more cautious stance. Related legal disputes may ultimately be decided by the Supreme Court. (BusinessInsider)