What Are Prediction Markets? How Polymarket, Kalshi and Myriad Work

Prediction markets are specialized exchange platforms where individuals trade on the outcomes of future events. Often described as “the wisdom of the crowd” in financial form, these markets allow participants to buy and sell shares in specific results, ranging from election winners to weather patterns or movie box office numbers. The price of a share functions as a real-time probability estimate; for instance, if a share for “Candidate A wins” is trading at $0.60, the market implies a 60% chance of that outcome occurring.

Polymarket has emerged as a leader in the decentralized prediction market space. Operating on the Polygon blockchain, it utilizes cryptocurrency (typically USDC) for transactions. Because it is decentralized, it offers a vast array of global topics, particularly political elections and cultural events, which have drawn massive trading volume. Its primary appeal lies in its liquidity and the broad range of niche markets that traditional financial institutions might not cover.

In contrast, Kalshi is a U.S.-regulated exchange overseen by the Commodity Futures Trading Commission (CFTC). Unlike decentralized platforms, Kalshi operates within a strict legal framework, focusing on “event contracts.” Its offerings are often geared toward economic indicators, Federal Reserve decisions, and significant legislative outcomes. By being regulated, Kalshi provides a level of institutional security and legal clarity that appeals to professional traders and risk managers looking to hedge against real-world events.

Myriad represents a newer wave of decentralized prediction and social betting platforms. It focuses on community-driven market creation and transparency, often leveraging blockchain protocols to ensure that market resolution is fair and resistant to censorship. Like its peers, Myriad aims to lower the barrier for users to participate in forecasting, turning speculative interest into actionable data.

Together, these platforms are transforming how the public consumes information. By incentivizing accuracy through financial stakes, prediction markets often provide more reliable forecasts than traditional pundits or polls, making them essential tools for modern data analysis and risk assessment.

Source: What Are Prediction Markets? How Polymarket, Kalshi and Myriad Work