The last time an industry grew this fast by making its product look this fun to teenagers, the product was a sleek vaporizer and the company was worth $38 billion right up until it wasn't.

That comparison — to Juul, the e-cigarette maker whose youth-oriented marketing preceded a spectacular regulatory and financial collapse — is now being applied with increasing frequency to prediction market platforms like Kalshi and Polymarket. Both allow users as young as 18 to wager on the outcomes of events, and both have embraced the kind of social media advertising that tends to attract the attention of United States senators.

This week, that attention arrived. Lawmakers from both parties used a Senate subcommittee hearing to express bipartisan dismay at marketing tactics that included, according to testimony, a Kalshi advertisement in which a young woman claimed to have paid her rent for two years by trading on the platform. (One imagines her landlord was less impressed by the disclosure.)

Polymarket, for its part, has posted Instagram content that even a generous reader might describe as crude, including a post about an N.B.A. player that relied on his surname for its humor. A representative for Polymarket declined to comment. Nick Tomaino, an early investor in the company, defended the approach in November, telling Front Office Sports that the posts were "done tastefully" and that "no one is offended."

Some people, it turns out, are offended.

Senator Marsha Blackburn, Republican of Tennessee, cited research indicating that more than one-third of boys between 11 and 17 had gambled in the past year, with 60 percent saying the opportunity had been delivered by social media algorithms rather than sought out. "Advertising to minors is disgusting," she said.

Nigel Eccles, a co-founder of FanDuel — a company that has had its own complicated relationship with gambling advertising — said prediction markets had "drifted into a type of advertising gambling companies have learned, often painfully, to avoid."

Ariel Givner, an attorney who has written about the sector, summarized the platforms' current posture as "growth mode, where it's like 'don't ask for permission, apologize later.'"

Juul, at its peak, was valued at $38 billion. Today, that figure is closer to $1 billion. The prediction markets have not yet reached that altitude, which may be fortunate, given how quickly the air can thin.

Original story published in Front Office Sports: "Critics Warn Kalshi and Polymarket Risk a Juul-Style Reckoning"