Gambling or Business?

Link to Article

Intrade is an online betting site that allows people to make predictions on the outcome of hundreds of actual events throughout the world.   Similar to how stock exchanges show the value of a company share and futures show the value of commodities; prediction markets show the value in the probability of a future event.  Users on this site can buy or sell shares in a specific event from other players in the market and either make a profit or take a loss.  The company was on-track to having a successful year in 2012, until the Commodity Futures Trading Commission filed a lawsuit against Intrade in November, claiming that the Ireland-based company was operating an illegal online business. Intrade immediately banned all its U.S members, but this may cause trouble for the company’s future since they U.S users make up a majority of the site’s business.

However, in March of 2013, New Jersey became the 3rd state to pass an online gambling bill, which reverses the policy made by the US Department of Justice which stated that online gaming was illegal across state lines, since 1961. This turn of events and sudden change of viewpoint on this industry has presented a new way for Intrade to revive as a predictions betting site. The CFTC’s main issue with the site is its involvement in betting on currency prices and a few current events, but nothing related to wagers on politics, which has been a large source of the site’s activity. Also, Intrade also has an opportunity to obtain a license in Nevada, which allows over 20 types of games and continue it’s business with minimal restrictions.

Although Intrade has been portrayed as a gambling site, it wants to present itself more like a market or exchange, having been founded by a former stock trader.  I believe that regardless of the purpose behind the business, it presents and portrays itself with the same qualities as a casino. This may pave the way for very dangerous and potential unethical issues.  Banning of such inter-state and overseas gaming transactions has been to deter severe negative social impacts, associated with gambling addictions. Also, these used to only be limited to traveling to casinos and narrowed down to a specific set of games. A site like Intrade, unleashes a realm of possibilities which allow for wagering on anything from what the weather will be like in a week, who wins the next presidential election, or if the United States will bomb a certain country in a certain year.  I cannot help but see a slippery slope that leads to a serious social dysfunction and addiction that may appeal to a larger population that has typically not been exposed to gambling.  These ethical issues need to be closely monitored and addressed before allowing any more states to reverse the original policy made.