Prediction Markets Explained
Prediction markets turn event odds into tradeable prices — how Polymarket works, and what moves prices.
الترجمة غير متاحة بعد — يتم عرض الإنجليزية.
Betting on outcomes with shares
A prediction market lists a future event — an election, a rate decision, a match result — and lets you buy shares in each outcome at prices between $0.01 and $1.00. A share in the correct outcome settles at $1; all others settle at $0. A price of $0.62 therefore reads as a ~62% implied probability.
Polymarket, the largest crypto prediction market, runs central-limit order books on Polygon: you can take existing orders or place limit orders like any exchange, and prices move as traders react to polls, news, and on-chain flows.
Why prices are probabilities (roughly)
Because every share settles at exactly $0 or $1, the market price is the crowd's expected value — an implied probability. Prices aggregate dispersed information fast: new polling or breaking news reprices markets within seconds, which is why funds and journalists watch Polymarket odds as a real-time sentiment feed.
The keyword is roughly: fees, liquidity gaps, and resolution risk mean price and true probability can diverge, especially on thin or long-dated markets.
Resolution is the real risk
A market is only as good as its resolution source. Polymarket markets specify resolution criteria up front (official results, UMA oracle disputes), and ambiguous wording has historically caused contested outcomes. Always read the market rules before sizing a position — a correct prediction on a badly-worded market can still lose.
Other risks: wide spreads on illiquid markets, event cancellation (shares typically settle at $0 or refund per rules), and regulatory restrictions by jurisdiction.
Prediction odds inside JW3.ai
JW3.ai streams live Polymarket prediction-market odds into the trading terminal, so agents and humans can weigh event probabilities next to spot, perps, and volatility data when sizing election-, macro-, or sports-adjacent exposure.
Frequently asked questions
What does a $0.62 price mean on Polymarket?
Roughly a 62% implied probability: shares in the winning outcome settle at $1.00, so price equals the market's expected value.
How do Polymarket markets resolve?
Each market names its resolution source up front, with UMA's oracle handling disputes. Always read the market rules — ambiguous wording is the biggest avoidable risk.
Can you lose money on a correct prediction?
Yes — if the market resolves against your reading of the rules, if liquidity forces a bad exit, or if the event is voided under terms you didn't read.