In this guide
What Is a Prediction Market?
A prediction market is a financial marketplace where traders exchange contracts tied to the outcome of forthcoming events. The price at which each contract trades represents the aggregate probability judgment of all market participants regarding whether that event will materialise. PolyGram provides UK-based users with access to a diverse range of global prediction markets.
How Do Prediction Markets Work?
Each contract within a prediction market poses a straightforward question: will Event X occur before Date Y? Take this instance: "Will Labour secure victory in the forthcoming UK general election?" Two distinct contracts exist for this scenario:
- YES: This contract settles at $1.00 should Labour emerge victorious
- NO: This contract settles at $1.00 should Labour fail to win
When the YES contract trades at $0.65, the collective market view suggests a 65% likelihood of a Labour victory. You may purchase YES if you believe the outcome more probable, or NO if you assess it as less probable. Correct predictions yield gains; incorrect ones result in losses on your initial investment.
Prediction Markets vs Traditional Betting
- No overround: Traditional bookmakers embed a profit margin into their odds — prediction markets eliminate this. The combined value of YES and NO contracts approximates $1.00
- You can sell before resolution: Close out your position at any time prior to the event concluding
- Transparent: Market participants have full visibility into pricing data and the order book
- Crowd wisdom: Market prices synthesise knowledge from tens of thousands of active traders — frequently surpassing the accuracy of conventional polling methodologies
Types of Prediction Markets
Political Markets
Electoral contests, public confidence metrics, legislative outcomes, shifts in leadership. These categories dominate trading volume and liquidity across major platforms such as Polymarket.
Sports Markets
Game results, championship victors, individual performance metrics, final standings.
Crypto Markets
Digital asset price milestones, blockchain development phases, investment product authorisations, governmental regulatory announcements.
World Event Markets
Macroeconomic metrics, geological phenomena, technological breakthroughs, cultural accolades.
Are Prediction Markets Legal in the UK?
Within the United Kingdom, prediction markets occupy an ambiguous legal position. The Gambling Commission has neither granted formal licensing nor issued explicit prohibition. Operators such as PolyGram function through decentralised blockchain settlement infrastructure, a structural distinction from conventional gambling frameworks.
How Accurate Are Prediction Markets?
Empirical studies consistently demonstrate that prediction markets deliver superior forecasting performance relative to professional analysts and conventional survey data. Polymarket's track record encompasses accurate forecasting of the 2024 US election outcome, numerous contests across Europe, and significant cryptocurrency developments—many called months in advance.