Americans’ Trading Jones is What’s Driving Prediction Markets, Adam Bjorn Says in Gambling Insider Q&A

Adam Bjorn has been a fixture in the sports betting industry for a quarter century, starting in his native Australia before venturing into Latin America and now the U.S.

He now runs Plannatech Enterprises, which provides the platform for Prime Sports in Kentucky, New Jersey and Ohio and operates as Betcris in Arizona. Plannatech is also in the process of closing on a deal to buy Prime Sports as the sportsbook emerges from bankruptcy.

Bjorn is a fixture on social media, where he breaks down how recreational and sharp players are betting the biggest games. 

Having seen many changes to the sports betting industry during his time in the business, Bjorn recently spoke with Gambling Insider about the rise of prediction markets in the U.S.

Responses have been edited for brevity.

GI: With Prime Sports being a low-hold, take all comers sportsbook, prediction markets would seem like your most likely competitors since they would appeal to the same customer base. Is that correct?

AB: To an extent, the advantage that I’ve had is exchanges, prediction markets, whatever you want to call them, have been around for two and a half decades. Betfair, Matchbook, all those kinds of things, and it’s just the same product rebranded with a different name, falling under a different regulatory body, if any real regulatory body at all.

I have no issue with prediction markets, because ultimately, it’s just another way of educating people, giving arbitragers more opportunities. For us, it’s about having a number. Whether we bet into prediction markets or other sportsbooks or people arbitrage just for a few pennies on things, that’s just part and parcel of what we’re trying to pick up. Our game is liquidity, just like prediction markets.

I was very anti-prediction markets in their ability to succeed. I’m somewhat sort of more on the fence now, because I’ve just seen the amount of volume going through these things. And I know it’s generally the market makers that make all the money – it’s not the actual exchanges – then a few professionals on the other side of it picking off as well and some playing dual roles.

There is an overlap there, but my competitors in what I see are more Bovada, Betonline, Bookmaker, those kind versus what’s sort of regulated in the U.S. right now, your golf course bookie and stuff like that. It’s as much education as it is anything else, just trying to get people to understand it.

When FanDuel and DraftKings come out, or regulators come out against prediction markets, it sort of shows every time they speak. They truly don’t understand the dynamic of the whole ecosystem and the different verticals and things like that. FanDuel and DraftKings are obviously trying to protect their moat by going into the prediction markets. They’re seeing Kalshi raising money at $22 billion, and they’re sitting there as a public company at $10 or $11 billion, which to me seems insane. Because they’ve obviously got a lot more opportunity with iGaming, which is everybody’s ultimate goal.

Prediction markets are sort of the fad of now. However, it’s showing that that’s the way you sort of package things to people. They know how to trade stocks in America. They have massive consumerism. When you just put it on Robinhood or another market and make it like a buy/sell thing, you’re getting a lot of square money and recreational money falling into it.

GI: How much does the complexity of the regulatory environment hurt the industry in the U.S?

AB: It’s only hurting the regulators and the legislators and the governments. Let’s call it what it is: The U.S. is really 50 little countries that run on their own, and now suddenly they have an umbrella. I guess it’s like the European Union that sort of sits over all the countries in Europe to a different extent. But for me, and this goes back to when I first came over to this side of the world. Sports betting was legal and available everywhere. You get over here, and you’re like, ‘Why haven’t they worked out a way to tax this?’ Eighteen years later, they work out a way.

Now your biggest gray market is in your own backyard. It’s not offshore anymore. So, how do you now tax that and get revenue out of that? Should (it be) the excise tax, which if they put excise tax on prediction markets, then it’s a dead product, because you can’t overcome that. If they removed (the tax) from the state-licensed operators, it would help the operators, because excise tax really isn’t bringing in that much money on the whole scale of things.

There’s a big enough economy and pie to share it around. Whether they end up saying they can’t do sports as a contract on a prediction market is neither here nor there. But, ultimately, if you block the prediction markets into straight trades – because they’re now looking to put a roulette wheel up and call that a 1-in-36 play your contracts kind of thing – if they just stay to main markets like buy, sell, the result of a game, and then all the carnival games, parlays, and whatever else you do can go to the state-licensed sportsbooks.

I think there’s a big enough ecosystem there where ultimately everyone finds their place and builds their product within what it is. But I think the way the U.S. is structured and having states and federal go after each other just to get to the Supreme Court, what’s that take? Does that mean everything sits in limbo until then?

GI: Are we seeing prediction markets bringing in new customers, or are they just siphoning off the existing base?

AB: I actually think they are bringing new ones in. There’s people that live on these Robinhoods. They have an account there. There’s no stocks to trade at nighttime or on a Saturday or Sunday afternoon, and they’re starting to tune into this. I think that’s where having the eyeballs on whatever product that you have is capturing more people.

I think it went from the offshore and local bookies to capturing people going, ‘This is easier to deposit. It’s on TV. It’s thrown in our faces.’ You are capturing that. Then, I think there’s another level now, of people who believe they’re winning traders, they can trade anything, and they’re picking up on the advertising. They’re making it easy looking, making it enticing – which is kind of why the latest lawsuit just came out of Kentucky (last month) with Kalshi.

At the end of the day, it’s still gambling. It’s still sports betting, but I do think that they are capturing another segment. Even potentially on the high end.

Everyone’s always looked at how do you capture the high-end traders, which is what SIG is dabbling in and whatnot. Their sports piece of what they’ve been doing the last four or five years is probably less than half a percent of all their other trading. But I think you have an effect of when it’s presented to you in a different manner that you’re familiar with, buying and selling things that are just a short-term contract, end up 100% or zero, with the ability to cash out or trade out at any given time. People would just want something to trade. So, I do think it’s definitely adding a segment to what already existed.

GI: Could you envision Plannatech going the way of a prediction market, if they’re ultimately allowed to offer contracts on sporting events?

AB: It’s not like we would open our own exchange. Obviously, we have an asset and a commodity, and we could plug into the back end of any of these places and offer liquidity and prices and stuff in the same way that all these market makers are.

We’ve been approached by quite a few of them to go ahead and do that again. It’s just a general API, making sure we get the numbers in risk management, making sure we’re getting the right bets back, working internally with the (prediction market’s) trading team.

So there have been conversations about it, but really, right now, we’ve just been concentrating on getting through this acquisition of Prime. But everything’s on the table. We even had conversations about sweeps at the times of saying: ‘Should we just abandon this model and go that route? Build a database that’s saleable?’ That’s what sweeps was, building databases in states that you couldn’t access legally or under regulation. Prediction markets are somewhat the same.