Prediction Markets Let You Bet on Whether a Wildfire Will Burn Down Your Town

Sylvie Andrews and her accomplice didn’t simply lose the brand new home they’d helped construct when the Eaton Hearth ripped by way of Altadena, California, in January 2025. They misplaced a whole decade’s value of sacrifices they’d made to place down roots of their hometown, and the group they’d created. “We put loads of blood, sweat, and tears into it,” Andrews mentioned. “That’s what we misplaced within the hearth.”

That fireplace, together with the Palisades Hearth to the west, destroyed greater than 16,000 constructions and killed 31 people. However whereas Andrews and 1000’s of Angelenos have been racing to evacuate, different folks noticed a monetary alternative. Utilizing Polymarket, the world’s largest prediction market platform, they made bets on the fires—how they might develop, how lengthy they might final, and the way a lot they might destroy.

Prediction markets are basically playing web sites the place folks wager on the end result of occasions, together with elections, sports activities, the climate, and extra. Something is honest recreation, from oil costs and the unfold of infectious illnesses to worldwide incidents. Markets normally body questions in a “sure” or “no” style, with the value of a “contract” fluctuating between $0 and $1. A value of fifty cents on a “sure” contract implies that the folks doing the betting collectively imagine the occasion has a 50 p.c likelihood of occurring. Market hosts earn cash by charging a price on wagers.

In January 2025, Polymarket listed almost 20 questions, created by the platform’s “markets staff,” associated to the wildfires burning up Southern California. How many acres will the Palisades Hearth burn by Friday, three days after it ignited on a Tuesday? Will the Palisades Hearth attain Santa Monica by Sunday? When will the Palisades hearth be 50 p.c contained? Will the Palisades and Eaton fires be contained earlier than February?

Individuals spent $1.2 million betting on these queries, according to Aeon Journal. “Wow,” Andrews mentioned repeatedly when she realized the determine. “My first take is that it’s morally reprehensible,” she mentioned. “The truth that somebody would really feel OK doing that flabbergasts me.”

“The prediction markets are simply the wild, wild West,” mentioned Susan Sherman, who grew up in Pacific Palisades. She misplaced her childhood house within the Palisades Hearth; her late mother and father had owned it since 1963, and now it was gone. She bought the empty lot just a few months in the past. “I take a look at (betting on the fires) as simply being very crass and heartless.”

As prediction markets boom and a brand new wildfire season begins, hearth survivors and ethicists say that the betting encourages and rewards callous considering—and harmful conduct.

One main concern stemming from wildfire prediction markets is arson. “That’s what has me nervous,” Sherman mentioned. Theoretically, betting might give somebody the perverse incentive to start out a hearth or assist one develop. Not like different disasters, reminiscent of hurricanes, flooding, or excessive warmth, a hearth will be manipulated in minutes by only one particular person. “Methods that tie monetary acquire to wildfire outcomes danger encouraging misuse, together with arson, and will not be appropriate with our mission,” a spokesperson for the US Forest Service mentioned.

“Think about what a nasty actor would possibly do,” mentioned Ann Skeet, the senior director of management ethics on the Markkula Heart for Utilized Ethics at Santa Clara College. “A market that may help that sort of exercise, I feel, is a harmful market.” Firefighters or land managers with unique details about a hearth’s conduct or an company’s firefighting plans might even be tempted to wager on a hearth, which might be thought-about insider buying and selling.