Users of Event Markets
crypto bros, forecasters, and tradfi participants
Prediction markets and forecasting platforms have quite different user types depending on how they are structured and the outcomes a platform is looking for.
Here’s a quick look at the following platforms
Real money (USDC on polygon)
Deployed on the Polygon blockchain
Tons of markets, highest volume and liquidity prediction market
Real money (USD, can fund from your bank, also support crypto now)
Regulated by the CFTC (congrats on winning approval for election markets)
Good amount of markets, slowly increasing volume and liquidity but still a very small number relative to Polymarket
Anyone can create a market
Started as just play money (mana) but now thanks to sweepstakes law there are “real money” markets alongside pure mana markets (btw manifold is looking for market makers)
A forecasting platform
No money involved (in fact some of the users are extremely against betting)
Not just anyone can create a question but it is generally more open than say a CFTC regulated exchange
Anyone can forecast (also they are rolling out notebooks/community pages were anyone can propose questions)
Note there are plenty of other prediction market and forecasting platforms, but I think generally any new platform fits into the archetype of those listed above
There are a few distinct types of users, all of which have a shared interest in trading prediction markets or forecasting events yet don’t overlap in many of their other values or interests. Sometimes there is so little overlap that power users of one type have never heard of the popular platforms of another type.
Nate Silver’s book “On the Edge” very nicely describes all of these people as “the river”. You can read my book review here
Forecasters
The start of prediction markets was rooted in Robin Hanson’s Idea Futures and some of the first platforms being the Good Judgement Project or Iowa Elections launched in the early 2000s generally attracted the type of person that “just want’s to know what is right”.
If you are interested in the history and future of event markets, Ramblings on Event Markets is a great start along with the history of corporate prediction markets from
and Dan Schwarz
They approach forecasting events in an extremely academic way, often debating the difference between a 62% chance or a 65% chance of a specific geo-political event.
Forecasters are very focused on improving their calibration and being down to the decimal accurate which contrasts with the other user types that seem to focus on simply being directly accurately.
Forecasters generally focus on longer term predictions currently these are markets like
In Byrne Hobarts recent book Boom he brings up an interesting point how the crazy focus on AI Risk might actually be an existential risk in itself
2020 was a great year in terms of Metaculus and general forecasting relevance given their forecasting work on Covid-19. You can read a pretty detailed year in review here of forecasting.
Also extremely cool Metaculus partnered with the CDC to produce the report 2024-2025 Respiratory Disease Season Outlook. Here is how the report was conducted
This respiratory outlook incorporates expert opinion from 19 subject-matter experts specializing in COVID-19, influenza, and RSV epidemiology, infectious disease modeling, disease surveillance, and risk assessment methods. In partnership with Metaculus, CDC designed a questionnaire and process for soliciting views from experts on the upcoming fall and winter respiratory season. Experts each answered a series of questions on the expected hospitalization burden posed by each disease, as well as on key drivers for a season with a higher peak hospitalization rate.
Crypto Bros and Sports Bettors
These are largely one in the same, highly skewed younger male and with a large risk appetite. This type of user generally focuses on shorter term markets (betting on the game an hour before it starts, betting on the election a few days before). They like the thrill of risking a little many times to potentially earn many multiples.
If you are looking for a good general overview of this demographic and their behaviors. It kinda really helps that sports betting is so heavily regulated because we know a lot about the user types.
Blockchain based prediction markets like early Augur, Polymarket, Omen, GnosisDAO, etc. have always been something that a few startups will try every few years generally alongside crypto market cycles which also happen to generally run next to 4 year election cycles.
Each cycle the total volume and active user floor increases by a few multiples. There are tons of news articles about their relevance leading up to the election… and then the election is finished and they fall out of the news cycle hard (Polymarket sees a 84% drop in volume post election 2024).
Polymarket became so relevant during the 2024 election that Trump’s team was looking at it on election night, many people I know (including myself) went to sleep multiple hours before the election was called because the Polymarket odds had already shown a Trump win. Post election Polymarket’s CEO was raided by the FBI.
Polymarket has now focused in on offering sports markets (these are nice because there is no vig or house and you can trade in and out of your positions like a regular market). And I assume (based on this other prediction market) their token launch.
Tradfi
This is an interesting category where crypto bros like the thrill of hitting a trump win (EC) and trump win popular parlay with +400 odds and forecasters like thinking about updating their priors on whatever global conflict is top of the news cycle. Tradfi simply likes trading markets.
Event markets now let participants express view directly on an event.
Kalshi has been around for a little bit around ~4years since they were part of YC19 but they really didn’t get ton’s of attention until they took on and won a huge court case against the CFTC to allow the listing of regulated presidential election markets.
For the 2024 election you could trade CFTC regulated contracts on
You can still trade political, economic and other markets on Kalshi and IBKR there are thousands.
Liquidity across non political markets is always quite poor so Kalshi onboarded SIG to market make on their platform. They pretty much make markets for the economic indicator markets. You can see which markets SIG trades on here.
Where Polymarket saw a 84% drop across the platform. Kalshi’s most popular market after the election only received around $3m in daily volume (their election markets were doing over $100m). You can check daily volume by markets with this tool.
Even though Kalshi, IBKR and others have been dominated by presidential contracts (even more than crypto prediction markets) I have a strong belief that they will continue to grow organically until the next election and become more integrated into traditional portfolio’s.
In fact about 2% of a general diversified stock portfolio is almost a direct bet on the election and there were tons of proxy stocks for a trump win like DJT, Oil, etc. People want to bet on events, they maybe just don’t know you can do it in a direct way yet.
Charles Schwab is also an investor in Kalshi so I would say its high 80% chances that for the 2028 election Schwab offers event contracts on their platform (theres no market for this yet, but there should be!)
There’s also this element of the forecasting / prediction market wars. Especially Kalshi between Polymarket right now. Everyone is fighting for the attention of the traders while all offering pretty similar products.
I think if you are building a prediction market or forecasting platform you should do one or multiple of these
Offer Parlays
Focus on a specific niche - just economic markets, just sports (like Novig),just politics, etc.
Offer a continuous market either perps or date futures things like CPI or the Fed Rate don’t need to be bracket markets