The bank says that there are already worrisome signs in some indicators of consumer stress, citing a US News survey
[NEW YORK] Bank of America (BOA) is sounding the alarm over the explosive growth of prediction markets and sports gambling, warning it could lead consumers to take on too much debt and default on loans.
The rapid expansion of such bets is creating a new credit risk for lenders as gambling losses create financial stress for consumers, BOA strategists, including Mihir Bhatia, wrote in a note.
The strategists point to the rising popularity of online betting since the Supreme Court struck down a federal ban on sports gambling. More recently, prediction market platforms such as Kalshi and Polymarket are “creating a new form of…