7 Best Crypto Prediction Markets In 2024

Prediction markets are platforms that enable users to bet on the outcome of an event. Prediction markets are like futures trading platforms but for real-life events. They allow users to trade future outcomes easily.  Prediction sites built on the blockchain and that use crypto assets are generally known as Crypto Prediction Sites.

Crypto Prediction Sites use blockchain technology and smart contracts to manage prediction pools, individual wagers, and collation of prediction results. They also use technologies such as Oracles to feed the protocol with real-world data used to decide the final result of a prediction pool. Users can bet on these results using supported crypto assets. Crypto Prediction Sites are permissionless, they are devoid of central moderation and restrictions, thus allowing anyone to create a prediction pool and participate in the betting process.

How do the prediction markets work?

Contemporary prediction markets use the binary option structure for betting on events. On these platforms, participants in a prediction pool are required to choose ‘Yes’ or ‘No’ as the outcome of the concerned event. This translates to a share in the outcome. The shares (Yes or No) must tally to 1 and represent the percentage outcome at any stage. The percentage value of each outcome represents the participants’ opinion and the price of each share. For instance, for an event with a 60% Yes and 40% No, buying a YES share costs $0.60 and $0.40 for a NO share. At the end of the event, the votes will resolve to 1 and 0 representing the outcome. That is, every share for the winning bet will be settled at $1 each while every share for the losing bet becomes worthless.

Polymarket is one of the leading crypto prediction sites and a major focus in the 2024 US election. Shayne Coplan launched Polymarket in 2020. The decentralized prediction platform was deployed on Polygon, an Ethereum scaling solution. Polymarkets uses the binary outcome strategy as described earlier. By betting on any outcome, users purchase a share that resolves to $1 per share or $0 depending on the outcome of the event.

Polymarket gained popularity in 2020 thanks to the betting pool for the outcome of the US election. It was the subject of a 2022 lawsuit by CTFC (Commodity Futures Trading Commission). After reaching a $1.4 million settlement, Polymarket has continued to grow exponentially. At the time of writing, Polymarkets only accepts USDC stablecoin for predictions. Polymarket also has a limit order feature that enables participants to place an order for a share at a lower price.

• Polymarkets offer a prediction pool for crypto-related and real-life events like Politics, tech, business, and science.
• Polymarkets allow anyone to create a prediction pool, pool creators earn from the trading fees.
• Polymarkets supports USDC stablecoin for predictions.

Hedgehog is a decentralized prediction market on the Solana network. It utilizes the binary outcome strategy and AMM technology. Users can bet on possible outcomes or provide liquidity in both shares and earn through fees generated on the pool. Hedgehog Market allows anyone to create a prediction market for events related to politics, crypto, science, and more. Alongside the tradable market, Hedgehog Market also features a pooled prediction market as seen on Polymarket where users can stake their funds on an outcome, outcomes are resolved when the outcome of the event is confirmed.

• AMM-powered prediction market for real-life events.
• Pooled prediction market with real-time resolution
• Hedgehog Markets also feature Parlay pools.

Limitless is a crypto prediction market on the Base network. It allows anyone to create a prediction market for events in the crypto, sports, business, politics, and science sectors. Limitless prediction market also adopts the Binary outcome strategy, users are required to purchase a YES or NO share for any outcome. Market resolution on Limitless is not automated at the time of writing, team members manually resolve the outcome of each prediction market.

• Limitless offers a decentralized prediction market for real-life events.
• Users can also create liquidity for each pool and earn rewards through fees generated.

Drift is a DeFi protocol on the Solana market. It features a decentralized leverage and spot trading application. In addition to its DeFi applications, Drift protocol also features a prediction market that allows users to bet on the outcome of real-life events. Drift Protocol’s prediction market supports over 30 crypto assets for betting. The platform is powered by the Drift token.

• Prediction market for real-life events
• Decentralized leverage and spot trading application.
• Staking portal for the Drift token and other passive income programs.
• Decentralized swap application for Solana assets.

Swaye is in its beta testing stage at the time of writing. The platform allows users to create prediction markets and tokens and bet on outcomes of political, sports, science events and more. Swaye hopes to build a vibrant decentralized prediction market with an active community of ‘degenerates’. Swaye uses the binary outcome strategy by allowing dynamic naming of prediction tokens.

• Decentralized prediction markets for real-life events.
• Users have the leverage to name prediction tokens as desired.

Zeitgeist is a decentralized prediction market on the Polkadot Network. It allows users to bet on the future price of crypto assets and crypto markets. Zeitgeist also covers other sectors including politics, science, and mainstream finance. It also uses the binary outcome strategy.

• Zeitgeist offers a prediction market for events related to crypto, science, and politics.

Crypto prediction markets are a handy tool for participating in the independent pooling of opinion and pursuing financial opportunities. They offer several other benefits, including;

Analytical Tools For Real-Life Events

Popular crypto prediction markets enable thousands of people to vote on the outcome of an event. The number of people participating in this process makes prediction markets a study case for possible outcomes and opinions. Prediction markets present a cost-effective way to gauge public opinion and evaluate possible outcomes.  

Censorship-Resistant And Permissionless Medium For Wagering On Possible Outcomes.

Unlike centralized prediction markets, crypto prediction markets are built on the blockchain and allow unrestricted access. Due to this, it covers a population often restricted by centralized prediction markets. They also enable unfiltered representation of wagers and just like blockchain technology, they offer a censorship-free medium to bet on the outcome of events. Prediction results are decided via automated technology, thus reducing human involvement and errors.

An Efficient Tool For Driving Financial Benefits Through Analytical Skills

Users who can properly analyze a situation can pursue financial benefits via crypto prediction sites. Some crypto prediction sites allow anyone to create an event pool and invite others to bet according to their analysis of the situation. Anyone skilled in this sector could earn significantly from prediction sites.

Transparency And Insights On Micro Opinions.

Crypto prediction sites allow anyone to monitor and audit the prediction process. All data are trackable and can be verified independently. Apart from the primary results from crypto prediction sites, they provide insight into some often overlooked opinions. The developments around a prediction pool give an idea of specific reactions and a wider insight into micro opinions. For instance, periodic changes in the prediction results of the US election give an idea of individual reactions to certain events.

Scaling Blockchain And Cryptocurrency Adoption

Crypto prediction markets expand the use cases of blockchain technology and cryptocurrency. They offer crypto-native and mainstream individuals a platform to leverage blockchain technology in a fashion similar to what is obtained on web2 platforms. Crypto prediction sites attract a caliber of people who would otherwise not be interested in blockchain technology and cryptocurrency. For blockchain enthusiasts, it aids mass adoption of blockchain technology.

While prediction markets continue to develop and prove their relevance, they suffer from a number of issues that could limit their progression as a platform and analytical tool. The drawbacks of crypto prediction markets include,

Vulnerability To Manipulation

Crypto prediction markets are permissionless, this also means that they are accessible to foul players who attempt to manipulate platform results for several reasons which include influencing real-life events. Due to the absence of a central moderator to monitor the prediction process, these manipulations easily go through. Prediction markets are also structured to depend on financial power. An unbalanced financial power could lead to false-positive and false-negative results.

Blockchain-Related Complications.

Blockchain-based operations constitute a significant part of using crypto prediction sites. Due to the advanced technologies behind blockchain technology and cryptocurrency, many users find it hard to use these platforms. A basic knowledge of blockchain technology is required to use such platforms. Therefore, users who are not conversant with the technology are unable to participate in crypto prediction markets. 

Regulatory Friction

Crypto prediction markets are decentralized applications that make use of cryptocurrencies and in addition, they operate in a sector known for strict regulatory supervision. Polymarket was fined US$1.4 million by the Commodity Futures Trading Commission (CFTC) in January 2022 and currently operates from an uncertain regulatory position, especially in the US. Prediction markets have been the subject of regulatory friction. The regulatory situation and compliance structure for prediction sites are still not clear. This limits their operation in several regions of the world.

Issues Due To Population Size

Crypto prediction markets and prediction markets, in general, do not cover every significant research population. Most of these platforms can only be used by people who understand how they work and the technology behind them, this is not always are true representation of the concerned population. For instance, the Polymarket prediction market for the US election is largely dominated by crypto-friendly citizens. The faction of the population that is not involved in the crypto space and who do not understand how the platform works are not represented therefore results from such markets might not be fit for proper research use.