Prediction Markets in South Dakota

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A prediction market lets you trade event contracts tied to real-world outcomes. Each contract settles at a value that reflects what actually happened, so a position gains or loses based on how an event resolves. For South Dakota residents, this is a legal, regulated way to engage with questions about sports, elections, economics, and other public events in a state where licensed online options are limited.

How Prediction Markets Work

Prediction market contracts are priced between 0 and 100. That price reflects the market's current estimate of how likely an outcome is: a contract trading near 70 implies participants see roughly a 70 percent chance that the event resolves yes. You can open a position when you think the market has mispriced an outcome, and you can close that position before the event resolves by selling your contracts back into the market. When the event settles, contracts that match the real outcome are worth 100 and the rest are worth 0. Because contracts trade on an exchange, the price moves continuously as new information arrives and as other participants buy and sell.

How Prediction Markets Differ From Gambling

Event contracts are regulated as financial derivatives rather than as gambling. When you take a position, you are buying or selling a contract on a federally regulated exchange, trading with other participants at a market price rather than staking money against a house that sets the terms. There is no operator on the other side of your position moving the price in its own favor. That federal oversight is the reason these markets can reach states that have not licensed other online products. This area of law is still developing and remains contested in some places, so availability and the specific markets offered change over time and are not the same everywhere. Do not assume every market is open to you until you confirm it in the app.

Getting Started on Underdog

1. Sign up for an Underdog account.
2. Verify your identity, which the exchange is required to do before you can trade.
3. Add funds to your account.
4. Choose a market and review the current price before you open a position.

Confirm which markets are live in the app for your state, because the contracts available to you depend on where you are located and can change as the rules evolve.

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