There's a pretty decent counter-argument though: Prediction markets are just a market for users to counterparty each-other. Which means, technically, for every trade there is a winner and a loser, and both the winner and the loser are generally just normal people (or market makers). Polymarket/Kalshi just take X% on the top as a fee. Versus, with sports betting, the counterparty is the casino. Its the difference of trying to outsmart a massive casino, versus a more peer-to-peer system; the potential for ROI is (probably) higher in prediction markets.

I am still very, very anti prediction market, to be clear. But that is one reason why I would agree with a soft statement like "prediction markets are less harmful than sports betting" (in much the same way that a handgun is less harmful than a fully automatic rifle).