The Polymarket Guy

So far, Polymarket's creator has mostly stayed out of the limelight even as he runs one of the most influential sites in contemporary politics.

The 2024 presidential election is shaping up to be one of the most closely watched in recent history, and a new player has emerged on the scene that is offering an interesting glimpse into the race: Polymarket.

The crypto-powered prediction market has attracted a following among political junkies and even some candidates themselves, offering a platform for users to bet on everything from the outcome of the election to whether Donald Trump will select JD Vance as his running mate.

But what exactly is Polymarket, and how reliable are its odds? Here's a closer look at the company and its role in the 2024 race.

What is Polymarket?

Polymarket is a prediction market platform that allows users to buy and sell shares in the outcome of future events, such as elections, sports games, and economic indicators. The probability of an event occurring is determined by the price of its shares, which are set by a pool of bettors.

The platform was founded in 2020 by Shahab Shams and Ben Coplan, and it quickly gained popularity among crypto enthusiasts and traders. In 2021, Polymarket was fined $1.2 million by the Commodity Futures Trading Commission (CFTC) for operating in the U.S. without being registered with the agency.

Despite the fine, Polymarket has continued to operate in the U.S., and its odds have been widely reported by media outlets throughout the 2024 presidential campaign.

How does Polymarket work?

Polymarket users can buy and sell shares in the outcome of future events, such as the 2024 presidential election or whether the AP will call certain states by 8 p.m. The probability of an event occurring is determined by the price of its shares, which are set by a pool of bettors.

For example, on October 31, those who think Donald Trump will win every swing state could pay 26 cents, and if that comes to pass, the value of their contract will rise to $1. (If it doesn’t by election time, it will drop to zero). And, of course, the price will fluctuate in response to news events.

In theory, prediction markets like Polymarket are more reliable than polls because people have a financial income in the outcome, which gives them an incentive to be as accurate and truthful as they can.

Are Polymarket's odds reliable?

The reliability of Polymarket's odds is a matter of some debate. Some experts believe that the platform's decentralized nature and large pool of bettors make its odds more accurate than traditional polls. Others, however, point out that the platform's users are not necessarily representative of the American public, and that a large percentage of transactions on Polymarket are fake "wash trades."

A recent investigation by Fortune drew on blockchain data to reveal that around a third or more of the bets on Polymarket are in fact “wash trades”—a term that describes someone surreptitiously taking both sides of a trade. Doing so can manipulate markets by creating an artificial sense of trading volume or momentum in a given direction. This obviously has big implications concerning the integrity of Polymarket’s betting odds, and for the political process more generally. Polymarket declined to comment on the findings.

Ultimately, the reliability of Polymarket's odds is something that each individual user must decide for themselves. However, the platform's odds have certainly generated a lot of interest and discussion during the 2024 presidential campaign.