In this guide
What Is a Prediction Market?
A prediction market functions as a financial exchange where traders buy and sell contracts tied to the likelihood of specific future occurrences. Market prices for these contracts embody the aggregate probability judgment of all participants regarding whether an event will materialise. PolyGram operates as a UK-based prediction market platform offering exposure to a broad spectrum of international events.
How Do Prediction Markets Work?
At their core, prediction market contracts pose a straightforward proposition: will Event X materialise before Date Y? Consider this example: "Will the Labour Party secure victory in the forthcoming UK general election?" Two contract varieties are offered:
- YES: Pays $1.00 should Labour prevail
- NO: Pays $1.00 should Labour fail to win
Should the YES contract trade at $0.65, this signals the market perceives a 65% likelihood of a Labour victory. You may purchase YES contracts if you hold a bullish view, or NO contracts if you lean bearish. Correct predictions yield gains; incorrect ones result in capital loss.
Prediction Markets vs Traditional Betting
- Absence of overround: Traditional bookmakers embed a profit margin — prediction markets eliminate this. YES and NO contract prices combine to approximately $1.00
- Early exit capability: Liquidate your position at any time prior to the event resolving
- Full visibility: Market participants enjoy complete access to pricing data and order book information
- Distributed intelligence: Contract valuations synthesise insights from numerous traders simultaneously — frequently surpassing the accuracy of conventional polling methodologies
Types of Prediction Markets
Political Markets
Electoral contests, leadership approval, legislative outcomes, ministerial transitions. These dominate trading volumes and liquidity pools across major platforms such as Polymarket.
Sports Markets
Game results, championship victors, athlete performance metrics, divisional standings.
Crypto Markets
Digital asset price milestones, blockchain protocol developments, exchange-traded fund authorisations, compliance developments.
World Event Markets
Macroeconomic data releases, geological phenomena, technological breakthroughs, cultural accolades.
Are Prediction Markets Legal in the UK?
The regulatory standing of prediction markets in the United Kingdom occupies uncertain terrain. The Gambling Commission has neither granted formal licensing nor imposed explicit prohibition. Operators such as PolyGram function via blockchain-based settlement mechanisms, distinguishing them structurally from conventional wagering enterprises.
How Accurate Are Prediction Markets?
Empirical research demonstrates that prediction markets consistently outperform both specialist analysts and aggregated polling data. Polymarket's track record includes successful forecasting of the 2024 US election outcomes, numerous European electoral contests, and significant cryptocurrency sector events—often with considerable lead time.