In this guide
What Is a Prediction Market?
Prediction markets are venues where traders exchange contracts whose value hinges on whether specific future occurrences materialise. The price attached to each contract embodies the aggregate market view regarding the likelihood of that event taking place. PolyGram provides UK-based participants with exposure to prediction markets spanning worldwide developments.
How Do Prediction Markets Work?
Every prediction market contract poses a straightforward question: does Event X occur before Date Y? Take this illustration: "Will Labour secure victory in the forthcoming UK general election?" Two contract types exist:
- YES: Labour wins, contract settles at $1.00
- NO: Labour loses, contract settles at $1.00
Should YES trade at $0.65, participants are pricing a 65% chance of Labour's victory. Purchase YES if you believe the outcome more probable; purchase NO if you reckon it less probable. Correct predictions yield gains; incorrect ones result in losses on your capital deployed.
Prediction Markets vs Traditional Betting
- No overround: Traditional bookmakers embed profit margins — prediction markets eliminate this. YES and NO prices combine to approximately $1.00
- You can sell before resolution: Unwind your position at any stage prior to final settlement
- Transparent: Market participants observe all pricing data and order book activity openly
- Crowd wisdom: Thousands of independent traders feed information into prices — frequently surpassing survey-based forecasts in accuracy
Types of Prediction Markets
Political Markets
Electoral contests, public approval measures, legislative outcomes, executive transitions. These command the largest audiences and deepest liquidity pools across venues such as Polymarket.
Sports Markets
Game results, championship victors, individual performance metrics, divisional standings.
Crypto Markets
BTC and ETH price milestones, blockchain protocol developments, spot ETF authorisations, government regulatory shifts.
World Event Markets
Macroeconomic data releases, geological events, technological breakthroughs, cultural awards ceremonies.
Are Prediction Markets Legal in the UK?
The UK regulatory landscape for prediction markets remains ambiguous. The Gambling Commission has neither granted explicit authorisation nor issued formal prohibitions. Platforms including PolyGram leverage blockchain-based settlement mechanisms, distinguishing their operational model from conventional gambling frameworks.
How Accurate Are Prediction Markets?
Empirical studies demonstrate that prediction market pricing consistently outpaces expert opinion and conventional polling methodologies. Polymarket's track record encompasses accurate forecasting of the 2024 US presidential election, numerous contests across continental Europe, and significant crypto market developments—often weeks or months in advance of conventional consensus.