> It's a sign of our times and I don't think there is much that can be done about it by anyone.

Isn't cryptocurrency (for the most part) very traceable? If you make it too hard and risky for most people to participate in, you'll limit the negative effects. You could probably quite effectively discourage it by sanctioning any transactions with one of these markets, you've got some opportunity because at some point the cryptocurrency needs to be converted to/from cash.

Of course, you'd have to dedicate some investigative and enforcement resources to the effort.

If to bet on a prediction market you have to both use a VPN and launder your money like you're a drug dealer, and I don't think many people would do it.