The explosion of legalized gambling has set the stage for a provocative new frontier in the world of risk-taking — betting markets for everyday events, ranging from Taylor Swift streams to hurricanes hitting major U.S. cities.

Why it matters: Americans' growing fixation with gambling has fueled a multibillion-dollar sports betting industry, meme stock mania on Wall Street, record Powerball jackpots and soaring casino spending. Prediction markets could be the next to cash in on the phenomenon.

Zoom in: Users can bet on hundreds of real-world events — whether the Fed will cut rates, the high temperature today in Miami, Oscar nominations, the outcome of Supreme Court cases — on Kalshi, the only federally regulated exchange dedicated to event markets.

• Kalshi says its user base has grown 5x since the start of the year. Fed decisions and other economic data are its most popular bets.
• Last week, the Trump-tied trading firm Susquehanna became Kalshi's first dedicated institutional market maker — a major milestone in the platform's ability to unlock consistent liquidity.

What they're saying: "The vision of the company is to take this asset class mainstream," Kalshi CEO Tarek Mansour told Axios in an interview. "I want event contracts to be traded like a stock."

• Insurance companies and institutional investors already get indirect access to event markets by bundling and hedging certain assets, Mansour said — he just wants to simplify and democratize the process.
• "Kalshi is already the most accurate forecast for federal interest rates," Mansour says. "That's the beauty of these markets: they do an incredible job at aggregating the wisdom of the crowds to forecast the future."

The other side: Some ethics experts have raised concerns about the integrity of betting on natural disasters and other markets tied to human suffering, as well as those that could be subject to manipulation.

• The Commodity Futures Trading Commission, for example, has barred Kalshi from allowing users to bet on election outcomes — an order that the company is challenging in court.

"The reality is the tsunami and the earthquake are going to hit whether there's Kalshi or not," Mansour told Axios.

• "So the mission of the company is, can you provide people with better tools to manage their lives and do something a little bit smarter about the tsunami?"

The big picture: The overnight ubiquity of legal gambling has "left us in this status quo that's really ripe for some form of correction," Brett Abarbanel, executive director of the UNLV International Gaming Institute, told Axios.

• Sports gambling has exploded in popularity — Americans wagered a record $119.84 billion last year.
• A recent study found viewers of NHL and NBA broadcasts were exposed to an average of 2.8 gambling-related messages per minute. In recent weeks, the sports world has been rocked by high-profile gambling scandals.
• And it's not just sports: New technologies like the stock-trading platform Robinhood, which paid a fine this year over its use of "gamification" features, are capitalizing on "humans' propensity for risk," Abarbanel said.

The bottom line: There are more ways to strike gold — and to lose your shirt — than ever before.