U.S. billionaire John Arnold warns sports betting is destroying young men

John Arnold made his fortune predicting energy markets. Now the 52-year-old billionaire is turning that same analytical instinct toward a different kind of market, and what he sees is making him angry.

Arnold, the former Enron trader who built Centaurus Capital into one of America's most feared hedge funds before shutting it down at 38 to pursue philanthropy, has become one of the most prominent voices in a growing campaign against sports prediction markets. In an interview with Bloomberg, published April 17, he argued that these platforms are not just a new form of gambling. They are, he said, a systematically designed machine for trapping young men in debt.

"The sites have, deliberately or not, created a pathway for teenagers to get accounts and start gambling heavily," Arnold said.

His concern is not about prediction markets as a category. Arnold is comfortable with wagers on geopolitical events, wars, elections and similar outcomes. Those bets, he said, provide legitimate price signals that help businesses hedge political risks. They also unfold over days or weeks rather than seconds, which means they do not generate the same compulsive feedback loop that he sees in sports betting.

Sports prediction markets are different. Kalshi Inc., which dominates US exchanges, saw sports bets account for about 80% of its trading volume last month, according to Bank of America. The bank estimates the US market for sports-related contracts could reach roughly $1.1 trillion annually. That scale has drawn serious financial institutions into a debate they once stayed clear of. Charles Schwab CEO Rick Wurster said this week that his firm is exploring prediction markets tied to financial events but would avoid sports gambling, which he described as at odds with the company's mission.

What worries Arnold specifically is design. Traditional gambling required a trip to a casino, a physical location, a deliberate choice. Today, mobile apps link directly to bank accounts. Users can place dozens of bets in seconds. Parlay betting, where users combine multiple wagers into a single ticket in search of amplified payouts, has become one of the most popular formats on these platforms. "It's not like you're doing one bet, you're doing 20 bets at a time," Arnold said.

The result, he argues, is a product structured to maximise engagement in ways that closely resemble the design principles behind addictive social media apps. The harms he describes are concrete: debt, lower credit scores, mental health deterioration, and in the most extreme cases, suicide. Arnold said one of his own friends recently took his life because of gambling debts.

The problem became personal in another way when his teenage son told him that classmates had opened betting accounts despite being underage. Arnold declined to let his son do the same.

His response has been financial. Arnold Ventures, the philanthropic organisation he runs with his wife Laura, is committing at least $4 million in 2026 to address sports gambling impacts. That includes $2 million to the American Institute for Boys and Men in Washington to establish a policy group focused on sports betting, and more than $2 million in additional grants for research into the financial, behavioural and social effects of sports gambling. The institute's grants will be announced in the coming months. Last year, Arnold Ventures and Maryland Governor Wes Moore announced $20 million in grants supporting programs for young males.

Arnold is also supporting legislative change. He praised bipartisan legislation introduced last month by Senators John Curtis and Adam Schiff that would bar entities regulated by the Commodity Futures Trading Commission from listing contracts akin to sports bets or casino games. Currently, the CFTC regulates prediction markets and classifies sports wagers as event contracts rather than gambling products. Arnold's position is that sports-based prediction markets should fall under state gambling laws, which carry stronger consumer protections and age verification requirements.

He also criticised Robinhood Markets for blurring the line between investing and gambling on its platform, a pointed target given Robinhood's growing involvement in prediction markets.

The harms Arnold describes do not fall exclusively on men. A 2026 report from the Massachusetts Council on Gaming and Health found that while men are more likely to have gambling problems generally, women are more than twice as likely to develop problems specifically from online betting.

Arnold's decision to enter this fight follows a pattern. Before trading energy, he learned at Enron how markets could be gamed. His hedge fund became famous in part for correctly anticipating the collapse of Amaranth Advisors, which lost billions in the natural gas market. After closing the fund, he and Laura focused Arnold Ventures on what they call broken systems: infrastructure, higher education, criminal justice.

Online gambling, he now believes, is the next one.