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Goat herder hedges legislative risk using prediction markets - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Goat herder hedges legislative risk using prediction markets by Richard Sine Alternative Risk Transfer/Captives , Risk Management Aug 13, 2026 A new startup says it uses prediction markets to help businesses hedge the risk of legislative changes. One of its first clients is a California goat herder. Western Grazers uses targeted grazing to reduce wildfire risk, according to a statement Thursday from startup Castle Technologies. A recent legislative interpretation eliminated California’s wage framework for goat herders. If it is not re-examined by August, the company’s labor costs could quadruple, jeopardizing its business. Castle created a contract that pays up to $500,000 if California does not fix the wage rules by the end of September. If lawmakers restore the framework or pass a similar measure, the contract expires with no payout. Western Grazers paid a fixed premium for the protection. “As California moves into peak fire season, this [contract] is the one thing that will keep [Western Grazers owner Tim] Arrowsmith, his eight herders, and his 4,000 goats on the hillsides,” Castle said. Launched earlier this year by four Stanford graduates, Castle says it can help businesses map and hedge geopolitical, regulatory and supply chain risks. “Businesses face risks that traditional insurance often can’t cover,” Castle CEO Lucas Cavalieri said in the statement. “A rancher should be able to hedge a bill just like a farmer hedges wheat.” Castle worked with trading firm Susquehanna to create the hedge, defining objective settlement criteria and structuring the contract. Castle created the hedge and used Kalshi to “list the market,” while Susquehanna priced the contract and provided liquidity for the trade, according to the statement. “Prediction markets are becoming a practical risk management tool, not just for institutions but also for small businesses facing real-world uncertainty,” Eric Passmore, a senior trader at Susquehanna, based in Bala Cynwyd, Pennsylvania, said in the statement. 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