Polymarket CEO Shayne Coplan didn’t mince words at Axios BFD. At the annual summit with the world’s top investors and executives, Gen Z’s first self-made billionaire took a direct shot at American sportsbooks, calling them “scams” and “bucket shops.”
“You can’t expect to run a business that’s rigged against the consumer in perpetuity,” he decried his soon-to-be competitors.
Does he have a point?
The case against sportsbooks
If I told you a sportsbook will happily book your bets only as long as it thinks you’re a loser—and the moment you show even a hint of skill, it bans or limits you — would you call that rigged?
I know some people who would.
I mean, he’s right. -110 is a scam on consumers who don’t understand math. SGP is a scam on those who don’t understand correlation. Limiting bettors is scam on bettors who think they’ll be allowed to win.
He probably should add state regulators are the biggest scam artists.…
— Captain Jack Andrews (@capjack2000) November 19, 2025
With the exception of places like Circa Sports, that is, in fact, how most sportsbooks operate.
“You can only trade against the house. They can go and ban you if you make money, they can kick you off, they can profile you as a user to change the prices based on you.” Coplan continued. “That’s a scam. In traditional finance, that’s like a bucket shop, that’s like a scam, those are illegal.”
Pro sports bettors have found workarounds, to be sure, especially in states that foster competition by handing out state licenses liberally but responsibly. Still, it typically requires finding “beards” — other accounts to hide the true bettor’s identity — to get money down. And if you are in a state that has created a monopoly, you might end up with nowhere to play at all.
The structural problems run deeper than just banning winners, according to Coplan:
“The way that it currently works is that there is a duopoly instituted for sports betting in America, upheld by a patchwork, state-based solution, where every single state is like some sort of weird backdoor lobbying — the tribes get this, the tax is this rate, everything is this hodgepodge solution.” Coplan said. “And as a result it is so goddamn complicated and expensive that no new entrants can enter the market.”
For sharps, finding a way to wager can be as difficult and cumbersome as finding an edge.
Now, with sports event contracts available via prediction markets across the nation, banned and limited bettors have somewhere to go.
“These things are made as a result of consumer demand,” Coplan said of prediction markets.
But are they really getting a fairer shake?
The prediction market exchange trade-off
To the extent prediction markets are better than sportsbooks largely depends on two things: 1) the type of customer using it, and 2) the fees charged by a prediction market.
For the sharpest bettors, those who have found sustainable edges and have proven resourceful enough to take advantage of them at sportsbooks, exchanges may actually be more difficult to beat long term.
“To beat one sportsbook only requires beating the team behind that one book (not other pro bettors),” Rutgers professor Harry Crane posted on X. “To beat an exchange requires beating the market as a whole – the collective wisdom of everyone in the market, including all the pros.”
When sophisticated market makers, including institutional ones, replace the house, pricing becomes tighter and sharper. In spots where you might normally find a soft line—props or longshot futures—there may not be any liquidity at all.
“Exchanges with low fees and tight spreads offer better pricing than books,” Crane explained. “Recreational bettors essentially betting on random outcomes will lose at a lower rate over time.”
Fees, fees, fees
If a prediction market’s fees are too high, they may negate any benefits of trading on an exchange.
Take Robinhood, for example, which partnered with Kalshi to launch prediction markets on its app. Robinhood users are charged $0.02 per trade — $0.01 goes to Robinhood and $0.01 for Kalshi.
That means a golfer originally priced at $0.01 (implying 100-to-1 odds) becomes just 33-to-1 after fees.
Talk about a scam.
On Kalshi, users encounter more manageable but hefty fees that are closer to the vigorish charged at sportsbooks.
Essentially, they want to charge as much in fees as a sportsbook without taking on any of the same risk.
To Coplan’s credit, Polymarket has so far avoided charging users anything.
“We don’t make money. We lose money,” Coplan said.
Last October, in the lead-up to the 2024 U.S. election, on-chain data showed that 12.7% of Polymarket wallets were profitable. That analysis counted wallets, not users—on Polymarket’s current platform one person can own multiple accounts. In any case, it’s a much healthier number than the reported 3-5% sportsbook users that turn a profit.
That’s really what matters.
Fee-free trading, though, won’t last forever — not even on Polymarket’s blockchain platform.
“We’re eventually going to take a cut,” Coplan told Axios report.
Polymarket recently announced its fee schedule for its imminent U.S. launch — a separate, CFTC-regulated exchange from its blockchain product for international users. The fees are hardly noticeable, setting up an environment that will be more fruitful than what users will find at its competitors, sportsbooks and other prediction market exchanges alike.
Polymarket problems
Since we’re on the topic of Polymarket, I’d be remiss to not acknowledge the rule controversies and actual scams that have taken place on its platform and cost users millions.
In March, a market titled “Ukraine agrees to Trump mineral deal before April?” became the platform’s most severe manipulation scandal. Despite rules explicitly stating resolution would be based on “official information from the US and Ukrainian governments,” the $7 million market resolved as “Yes” even though no such deal had been officially confirmed.
One of the most chaotic and corrupted prediction market resolutions happened earlier this week on a $7m market on Polymarket, with the aid of an UMA dispute.
Multiple bulwarks to prevent something like this from happening totally failed.
Let’s call it a “Home Alone Attack.”… pic.twitter.com/dX1zmUhg6x
— Domer❤️🔥 (@Domahhhh) March 27, 2025
Later, in July, a $242 million market on whether Ukrainian President Zelenskyy would wear a suit sparked outrage when UMA token holders voted “No” after nine days of disputes — despite photographic evidence and reporting from major media outlets.
And there have been others.
Those issues were a byproduct of its decentralized UMA protocol which has proven both blessing and curse. Luckily, it’s something U.S. customers will not have to worry about with its new platform, which will determine market outcomes in-house, preventing blatant resolution abuses.
While Polymarket may offer fairer pricing than sportsbooks, it’s a reminder that escaping traditional betting platforms doesn’t guarantee a better experience.
The verdict: Competition is long overdue
So is Coplan right? Are sportsbooks a scam?
Many sportsbook practices are simply indefensible, and it is foolish to argue they have some moral high ground over their newest competitors. Prediction markets offer viable alternatives with real advantages for consumers: no arbitrary account limits, transparent pricing, and, if the fees are small enough, higher profitability rates among users.
But prediction markets aren’t a panacea by virtue of being a prediction market. Professional bettors face stiffer competition from institutional traders. Market liquidity can be thin. And fees can be just as “rigged” against the consumer — just look at Robinhood.
The real test will come as these platforms scale and mature. Will Polymarket maintain low fees, or will it gradually extract more value from users until it resembles the sportsbooks it hopes to replace? Will other entrants follow Polymarket’s model or Robinhood’s?
For now, though, bettors have options.
Whether prediction markets prove better or just different, they’ve already accomplished something valuable: forcing a much-needed conversation about how sports betting should work and who it’s designed to serve. For an industry that has been built on banning its most successful customers and preying on its weakest, the competition is long overdue.
