What was expected to be a roaring summer comeback for live music has turned into a season of precarious doubt, thanks to vaccine hesitancy and the delta spread of Covid-19. And a financial tech company is giving would-be concertgoers a chance to cash in on the uncertainty.
Kalshi, a startup, is an online trading platform that allows users to wager on results through a binary “yes” or “no” scenario — spanning mundane to high-profile topics, from whether it will be greater than 80 degrees in New York tomorrow to whether a certain number of Americans will be vaccinated by November. Users buy “yes” contracts or “no” contracts at a certain price, and each contract they purchase wins them a dollar if their result proves correct. Kalshi is regulated by the U.S. Commodity Futures Trading Commission, and the company has attracted investors including Charles Schwab and venture capital firm Sequoia Capital, which were both part of Kalshi’s $30 million Series A funding round.
Recently, Kalshi has deemed Governor’s Ball, the upcoming music festival in New York, enough of a risk to add it onto the market list. Kalshi users now have an almost hilariously macabre means of commodifying Covid’s ongoing impact on live music — one of the largest blows the global music business has ever seen — for themselves.
As of publication, over 1,500 people have placed wagers on whether Governor’s Ball will cancel at least one day of the three-day festival, due to take place September 24th to the 26th. Buying on a cancellation currently costs 24 cents per contract, while wagering that the show will go on as planned costs 78 cents, meaning that Kalshi’s market seems much more confident in a full slate of shows with no speed bumps.
Live music’s trajectory has been volatile since the pandemic began. Festivals and national tours have faced several cancellations and postponements, with New Orleans Jazz Fest getting canceled last month while artists including Garth Brooks, Nine Inch Nails and Stevie Nicks shelved their 2021 touring plans as well. But on the whole, shows are still more frequently carrying on than facing the axe, adopting extra health measures like vaccine and negative Covid test requirements for entry. Such measures seemed to work well for Lollapalooza, which brought in 400,000 people to Chicago while reporting only a couple hundred confirmed Covid cases.
Those hoping to trade on future festivals may be in luck: Kalshi says the Governor’s Ball cancellation contract is the first of many the company is planning to offer, going forward.