Kalshi Culture: How Gambling, Speculation, and Degeneracy Went Mainstream

In a recent interview, Tarek Mansour, the co-founder of Kalshi—a company with a marketplace where users gamble on the outcome of future events—said “the long-term vision [of the company] is to financialize everything and create a tradable asset out of any difference in opinion.”

Currently, Kalshi users can place bets on virtually anything—from the outcome of a college football game to whether it will rain in Dallas next week to who Donald Trump will pardon during his presidency. On that last bet, the leading option is Donald Trump himself, with 42 percent of that particular action predicting a self-pardon. Trump’s son, Don Jr., is running a close third at 26 percent.

Coverd is a company “gamifying” the crushing credit card debt in which the young and middle class find themselves. The Coverd app allows users to link their credit cards, purchase credits, and then use those credits to participate in online gambling activities like slots and roulette. “Winners” of the gambling games have certain credit card purchases paid for by the company. In summary, Coverd entices those who are already in debt and have a proclivity toward gambling to take up online casino games as a supposed cure for those debts.

Cheddr is an online sports gambling company that bills itself—without a hint of shame—as the “Tik Tok of sports wagering.” Clearly targeting young adults, the company intends to make placing a sports gambling bet as easy as swiping across a smart phone screen.

Unsurprisingly, the venture capital industry is providing heavy financial and marketing support for these companies, with Silicon Valley titans like the scummy Andreessen Horowitz directly invested in both Coverd and Cheddr.

Separate from gambling, a large portion of the mega-tech industry seems to be heavily reliant on forms of scamming, earning a substantial portion of their revenues therefrom.

A report from Reuters recently uncovered that Facebook (aka Meta Platforms) projected in internal company documents that it would earn 10 percent of its revenue—or $16 billion—from “running advertising for scams and banned goods.”

Anyone who has spent a few minutes on Google’s YouTube knows that the majority of products advertised on that platform are not just outright scams in and of themselves, but the advertising content itself is often carried out by illicit AI renderings—or “deepfakes”—of celebrities. AI Andrew Huberman or AI Joe Rogan promoting an absurd health scheme, for example.

Tesla—a zombie company with a market cap over a trillion dollars—has earned billions of dollars in revenue by selling a feature they call “Full Self Driving.” This despite the fact that Tesla has never actually produced a vehicle capable of full self driving—a term with an established technical meaning in the auto industry and its regulatory sphere—or anything close to it.

The Root Cause Question

An inappropriate position to take on the preceding companies and technologies is that they should be banned or heavily regulated. While short on productive aptitude, creepy rent-seekers like Tarek Mansour, Marc Andreessen, Elon Musk, and Mark Zuckerberg are nevertheless responding to a market demand.

A more appropriate position is to ask why speculation and gambling are proliferating so rapidly in today’s American economy. The answer, naturally, starts with the debasement of our currency at the hands of the central bank and at the insistence of our political class.

The democratic system depends on the provision of promises during campaign time and distribution of largesse after the campaign is over. When the costs of what government has promised inevitably surpass its ability to collect taxes in like amounts, it resorts to various forms of currency debasement. In a fiat money context, this is achieved through a consistently inflationary monetary policy comprising the creation of money and imposition of artificially low interest rates by the central bank combined with excessive borrowing by the federal government.

As the government controls more and more of the money supply in this fashion, two phenomena are observed.

First, developing wealth—denominated in that money—becomes a function of serving government, or “front-running” government policy, rather than providing goods or services of value to other human beings. Hence, the rise of the rent-seeker class.

Second, the constant debasement of the currency and accompanying price inflation causes a shift in mindset among its users. The moral and cultural blight of high time preference appears—and ultimately becomes ubiquitous—among the general population. This blight is characterized by a number of things, but primary among them is a neglect of careful, long-term planning and prudence in favor of immediate, often reckless, consumption.

The behavioral offshoots of the persistent erosion of purchasing power are manifest today in the widespread obsession with gambling on meme stocks and garbage cryptocurrency, for example, but other instances abound outside of the world of personal finance. High rates of fatherlessness, crime, and a general decline in civility are all—in no small part—caused by this shift to high time preference.

Sadly, companies like Coverd and Cheddr—and, for that matter Tesla, Facebook, and Google—are simply responding to this shift in cultural values. Rotten meat will attract flies, after all.