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The Rise of Prediction Markets: How Bettors Are Shifting Away from Traditional Sportsbooks

By jili tutorial · September 23, 2026

The Rise of Prediction Markets: How Bettors Are Shifting Away from Traditional Sportsbooks

The betting landscape is undergoing a quiet but significant transformation. While sportsbooks have long dominated the world of wagering, a new competitor — prediction markets — is steadily eating into their customer base. Recent data from Fullstory, a behavioral data analytics company, reveals that a sizable portion of bettors are now rethinking their relationship with traditional sportsbooks as yes/no exchanges (prediction markets) become more accessible and diverse.

This guide unpacks the survey’s key findings, explores the forces driving this shift, and looks at what sportsbooks can do to stay competitive.

The Survey: A Snapshot of Changing Behavior

Fullstory’s survey of bettors paints a clear picture of disruption:

These numbers suggest that prediction markets are not merely a niche alternative — they are actively reshaping consumer habits. As Jason Wolf, president of Fullstory, put it: “Consumers are being presented with more options for how they can participate in online gaming, creating a more competitive landscape where a seamless digital experience is increasingly becoming part of the value proposition.”

Why the Shift? Understanding the Appeal of Prediction Markets

Prediction markets offer a fundamentally different user experience from sportsbooks. Instead of traditional odds and point spreads, they operate as yes/no contracts that settle at $0 or $1 depending on whether an event occurs. This binary structure can feel simpler and more transparent to many users.

Key Drivers of Adoption

According to Fullstory, 62% of consumers have tried sports event contracts, while 42% have traded economic or financial derivatives and a similar percentage have engaged with election or political event contracts. More than a quarter of respondents have traded at least one entertainment or pop culture derivative.

This expanding breadth is crucial for the industry’s future. Some analysts estimate that total prediction market volume could reach $10 trillion by 2035, with non-sports categories eventually overtaking sports as the primary driver.

The Personalization Factor: Customization as a Competitive Edge

Both sportsbooks and prediction markets share a common goal: keeping users engaged. One of the most powerful tools in achieving that is personalization.

Fullstory’s data highlights the growing demand for tailored experiences:

These figures may seem small, but in a competitive market, even a 10% swing in user loyalty can translate into millions of dollars in revenue.

What “Customization” Looks Like in Practice

Sportsbooks have long relied on sign-up and retention bonuses to attract customers, especially during high-profile seasons like the NFL or college football. Promotional spending remains effective, but Fullstory’s findings suggest that a one-size-fits-all approach may no longer be enough. Bettors increasingly expect platforms to understand their preferences and offer a bespoke experience.

What This Means for Sportsbooks: Threat or Opportunity?

The 35% reduction in usage among some bettors could be interpreted as a warning shot. However, it’s important to note that many users still prefer sportsbooks. When given a choice between a traditional sportsbook and a prediction market, a variety of other studies indicate that bettors often stick with the sportsbook — especially when bonuses and promotions are factored in.

Still, the message is clear: competition is intensifying. Sportsbooks must respond by:

  1. Improving digital experiences — reducing friction in navigation, payment, and customer support.
  2. Investing in personalization — using real-time data to understand how consumers interact with their platforms.
  3. Expanding their own offerings — some sportsbooks have already begun adding prediction-style contracts or novelty bets to keep users engaged.

As Jason Wolf noted, “The brands that understand how consumers are navigating, comparing, and engaging with their platforms in real-time can identify where friction is getting in the way of trust and retention.”

Conclusion: A New Betting Ecosystem Emerges

The rise of prediction markets does not spell the end for sportsbooks, but it does signal a shift in consumer expectations. Bettors now have more choices than ever, and they are increasingly willing to explore platforms that offer simplicity, transparency, and personalized experiences.

Sportsbooks that fail to adapt risk losing a meaningful share of the market — especially among younger, tech-savvy users who prioritize flexibility and customization. Prediction markets, meanwhile, are betting big on their ability to expand beyond sports and capture a broader audience.

The next few years will likely see more convergence between these two worlds. For now, the data from Fullstory serves as both a roadmap and a wake-up call for the entire online gaming industry.