'This is the New Casino': Why Gen Z Is Betting on Sports and Prediction Markets

Owen Dulong still remembers the excitement he felt when he settled in to watch UFC 300 in April 2024. He and a friend had their phones in hand, making their picks before the action got underway. “I placed a bet for 12 fights in a row, and I got them all right,” he says. “I won a lot of money. It felt very good.”

Dulong, now 25, says betting is something he does for fun, usually in small amounts and often with friends while watching a game. Some of his peers see it differently. He has heard them call a wager “a sure-fire bet” and “basically me investing my money.”

That blurring of betting and investing is showing up across his generation. A recent survey by Betterment, a U.S. wealth and savings platform, found that 26% of Gen Z investors said sports betting was part of their long-term financial strategy.¹ Among that same group, 52% said they had put money initially intended for investing into sports betting over the past year.

A similar line is emerging around prediction markets, which let users bet on real-world outcomes such as elections or awards shows. A Northwestern Mutual study found that 32% of Gen Z adults were considering using sports betting or prediction markets, compared with 17% of US adults overall.²

The long-shot logic

Researchers say that one reason younger people might be turning to riskier markets is that they feel it’s the only way to reach their financial goals. Dulong has friends who fit that description. “They’re like, ‘Oh, I’m definitely not going to be able to afford a home,’” he says. “‘I might as well put 100 bucks on this game.’”

Northwestern Mutual’s study corroborates that thinking. It found that among Gen Z respondents drawn to high-risk speculative assets, 80% feel financially behind and view those products as a faster way to reach their goals than traditional methods.

Samer Nusier, Vice President and Managing Director of Product and Strategy at RBC Direct Investing, isn’t surprised to see those numbers. He says that when the usual route to financial security feels out of reach, a riskier bet can start to look like an opportunity. “There’s at least a cohort of young people who look at these things and say high risk, high reward, but it’s my one shot,” he says.

Always within reach

The fact that betting and prediction markets are now legal and more accepted in society is one issue contributing to the rise in high-risk speculative assets, says Jeffrey Derevensky, Director of the International Centre for Youth Gambling Problems and High-Risk Behaviours at McGill University. Sports betting, for instance, has become much less stigmatized over the years. “Gambling has become normalized in our society,” he says. “It’s no longer viewed as sin and vice.”

That normalization has changed how some young people view betting, not just as entertainment but as a potential path to financial gain. For many, a wager takes seconds and can be placed almost anywhere, while saving or investing still requires patience and regular contributions, and the payoff can be, or at least feel years away. “This is the new casino,” Derevensky says. “And Gen Z is looking for more immediate returns.”

Every play is another bet

Sports betting appeals to younger generations because they feel like they have expertise and may already follow players, injuries and matchups closely. That familiarity can make sports wagering seem less risky than it really is.

“Young people, especially young males who grew up watching and playing sports, think they have excessive amounts of knowledge and can predict the outcome of a particular game or performance within a game,” Derevensky says.

That confidence can be reinforced by the way the apps work. A bettor used to make one pick and then have to wait for the final score. Now odds move throughout the game, and new bets keep appearing, giving a loss almost no time to settle. “In two minutes or less, I can make another bet in order to try to recoup my money,” he says.

For Derevensky, this becomes a problem when people mistake betting for a wealth-building plan. A bettor might cash a big ticket on any given night, but the long-term odds still favour the operator. He contrasts that with dividend-paying stocks and other investments structured to return value over time. “The research seems to suggest that less than 10% of people are actually making money on sports wagering,” he says.

When betting sounds like investing

Prediction markets may not yet be as prevalent in Canada as in the U.S., partly because regulators here allow only predictions on economic forecasts, environmental forecasts and financial indicators. U.S. sites such as Kalshi and Polymarket, by contrast, allow people to bet on politics, culture and other real-world outcomes using what they call event contracts, borrowing the language of finance. That financial framing, Nusier says, helps the sites argue that they should be treated as financial products. “It’s an intentional regulatory strategy,” he says. “These things don’t really have a linkage back to investing.”

Dulong draws the line between betting and investing clearly in his own life. He may use betting to make a game more interesting, but he says money meant for savings or investing stays separate. “I make sure I invest the money I [plan to] invest,” he says. For betting, “it’s only extra money or $20 here and there that I’m willing to part ways with.”