In this guide
What Is a Prediction Market?
A prediction market is a financial exchange where traders buy and sell contracts tied to the outcome of forthcoming events. The cost of any contract mirrors what the collective market believes is the likelihood of that event taking place. PolyGram operates as a UK-based prediction market platform offering exposure to worldwide occurrences.
How Do Prediction Markets Work?
Every prediction market contract poses a straightforward question: will Event X occur before Date Y? Take this example: "Will the Conservative Party secure victory in the next UK general election?" Two contract types exist:
- YES: Should the Conservative Party prevail, this contract settles at $1.00
- NO: Should the Conservative Party fail to prevail, this contract settles at $1.00
When YES trades at $0.65, traders are pricing in a 65% chance of Conservative victory. You might purchase YES if you believe the odds favour them, or NO if you reckon otherwise. Correct predictions yield gains; incorrect ones result in losses on your investment.
Prediction Markets vs Traditional Betting
- No overround: Sportsbooks embed their profit margin — prediction markets eliminate this. YES and NO prices combine to approximately $1.00
- You can sell before resolution: Close out your position at any moment prior to the event concluding
- Transparent: Every price and order book entry remains visible to all participants
- Crowd wisdom: Prices synthesise knowledge from tens of thousands of market participants — frequently surpassing traditional surveys in accuracy
Types of Prediction Markets
Political Markets
Referendums, leadership contests, legislative outcomes, ministerial appointments. These dominate trading volumes and liquidity across major venues such as Polymarket.
Sports Markets
Game results, championship victors, individual athlete performance metrics, final standings.
Crypto Markets
Ethereum valuations, blockchain upgrades, cryptocurrency fund launches, government policy shifts.
World Event Markets
Inflation trends, geological events, technological breakthroughs, award ceremonies.
Are Prediction Markets Legal in the UK?
The regulatory standing of prediction markets within the UK occupies uncertain terrain. The Gambling Commission has neither formally authorised them nor formally prohibited them. Operators such as PolyGram function via blockchain-based settlement mechanisms, distinguishing them from conventional gambling frameworks.
How Accurate Are Prediction Markets?
Empirical studies demonstrate that prediction markets consistently surpass specialist analysts and survey-based estimates in forecasting accuracy. Polymarket's track record encompasses successful predictions on the 2024 US presidential election, numerous contests across the EU, and significant cryptocurrency developments—many called months in advance.