Online bettors think the Minneapolis mayoral race is close

The Minneapolis mayoral election looks close, according to the odds listed by prediction markets that allow traders to bet on the election’s outcome.

Trading on the PredictIt website, for example, gave incumbent Jacob Frey about a 6 in 10 chance of winning re-election as of Friday morning. Frey’s leading challenger, state Sen. Omar Fateh, who recently won the endorsement of Minneapolis Democrats for the seat, was given about a 4 in 10 chance of winning.

That means traders feel the race is close, according to Ethan Rosen, assistant director of the Washington, D.C.-based PredictIt.

“It’s fair to say the prediction market says this thing is neck and neck,” Rosen said.

As of Friday, traders were risking a total of about $1,500 on the Minneapolis mayoral results on PredictIt.

Kalshi, another prediction market, projected a slightly wider lead for the incumbent. The traders there gave Frey a 67% chance of winning as of Friday. Fateh had 36% shot at victory, according to Kalshi traders, who were betting more than $9,600 on the outcome.

While most online betting is illegal in Minnesota, these prediction market platforms refer to the transactions as trades, not bets. Kalshi has argued that it’s a financial exchange, not a sportsbook website. PredictIt says it is “an experimental project operated for academic purposes under permission from the CFTC.”

Rosen said any American over the age of 18 can speculate in a PredictIt prediction market. But he said at PredictIt, the Commodity Futures Trading Commission, which regulates exchanges trading on the outcome of future events, limits the amount you can risk on a single election result at $3,500 per person. That’s also the current individual campaign contribution limit for federal elections.

The Kalshi website is also open to U.S. traders above the age of 18, but Kalshi spokesman Jack Such said traders on that site can speculate up to $25,000 per question.

Prediction markets that allow people to trade contracts with each other on a yes-no proposition are seen as an alternative to traditional betting websites as a way to make money if you think you know the outcome of a certain event.

They’re also increasingly being seen as an alternative to polls as a way to predict the outcome of an election.

“Kalshi’s vision is to allow people to capitalize on their opinions, trade in the domain of every day, and hedge risks that relate to them,” according to the Kalshi website. “The price that a given event contract trades at is actually the market’s assessment of the probability that the event will happen.”

National elections are especially popular among traders in predictions markets. The 2024 U.S. presidential election attracted trading that amounted to $500 million on the Kalshi website, according to Such.

Kalshi currently is letting speculators trade on who will win the Nobel Peace Prize. (On Friday, the leading candidate was Yulia Navalnaya, the widow of Russian opposition leader Alexei Navalny, at 25%, followed by Donald Trump at 12%.) Or who will be the top artist on Spotify this year. (The market said on Friday that Bad Bunny had a 68% chance.) Or who will be named in the Epstein files released this year. (Kalshi traders say the leading candidates are Bill Clinton, Alan Dershowitz and Prince Andrew.)

Other Minnesota-based issues on the PredictIt site include which party will win the U.S. Senate seat up for election in 2026. Friday’s trading indicated an 85% chance that it will be the Democrats.

On the Kalshi website, you can also trade on which party will win the Minnesota governor’s and attorney general’s seat or who will be the Democratic nominee for the U.S. Senate race. (Trading on Friday indicated that Lt. Gov. Peggy Flanagan had a 72% chance, followed by U.S. Rep. Angie Craig at 26%.