Admittedly not as entertaining as the George Santos prediction market scandal, but arguably more disturbing.

It's remarkable how the 2020s have made what would once have been shocking seem like no big deal.

From Semafor:

The owners of a top-tier Spanish soccer team had to move fast. Coming into the final game of the season, the club was on the brink of getting kicked down to a lower league, which would have meant millions in lost ticket and broadcast revenue.

So they turned to Kalshi, placing a multimillion-dollar bet against itself, in case the game didn’t break its way. In the end, the club squeaked by, losing its final game of the season by a narrow enough margin, 1-0, to keep its place in the top tier of La Liga.

On one level, this is not that different from the hedge trading that investors have been doing since we've had modern markets. You take an offsetting position to limit your potential exposure to an adverse event. It's not even entirely clear, in this particular case, that this is unethical (assuming the potential payout for winning the bet was less than the revenue hit the team would have taken from losing their top-tier standing. in other words, as long as they had not incentive to throw the game). .

But this very much looks like a slippery slope. It is difficult to imagine that, even if there's no wrongdoing at first, opening this door won't quickly lead to increasing corruption and massive scandals.

What's most remarkable, though, is that as bad as the idea of loosely regulated prediction markets may be, it's not even in the three worst financial "innovations" of the decade.