Small businesses use prediction markets for hedging

Small business owners are increasingly using prediction market platforms like Kalshi to hedge unique operational risks and fund consumer promotions. While proponents view these tools as vital financial protection, critics debate their regulatory status and similarity to gambling.

FILE PHOTO: Kalshi logo is seen in this illustration taken, August 3, 2026. REUTERS/Dado Ruvic/Illustration/File Photo

Small businesses across the United States are turning to prediction markets to manage operational risks, deploying event contracts as customized financial hedges. Larger firms have historically relied on traditional Wall Street instruments for risk management. Smaller companies now seek alternative financial cover as market volatility increases.

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