What Are Prediction Markets? How Polymarket, Kalshi and Myriad Work – Decrypt

Prediction markets corresponding to Myriad, launched by Decrypt‘s mum or dad firm Dastan, have quickly gained traction in recent times, enabling customers to foretell the outcomes of all the pieces from crypto market actions to geopolitical occasions.

So what precisely are prediction markets? Learn on to seek out out.

What are prediction markets?

Prediction markets have existed in a single kind or one other for the reason that sixteenth century. They permit customers to take a position on the end result of any future occasion—so long as somebody has arrange a marketplace for it.

Customers can try and predict the end result of sporting occasions, elections, authorized circumstances, and something with a transparent or provable end result. The core idea could be very easy: in case your prediction is correct, you win cash. In the event you’re improper, you lose the cash you place as much as again your prediction.

The mechanics that underpin them are deceptively easy. The worth of 1 “share” in a prediction market ranges from between $0.00 to $1, and its worth correlates to its share likelihood of successful, or its “odds.”

For instance, if a share for one candidate in an election prices 63 cents, that candidate has a 63% likelihood of successful, in accordance with this particular market. If you wish to predict the end result of the election, you’d purchase shares of whichever candidate you suppose will win. When the election is over, the market will resolve, and the value will go to $1.00 per share for whichever candidate received. The decrease the percentages of one thing occurring, the cheaper making predictions on it should change into, and vice versa.

There are a number of various kinds of prediction market.

• Binary markets are markets with two choices that may resolve to both $1 or 0 (sure, or no), corresponding to “Will it rain on Monday of subsequent week”?
• Categorial markets are markets with a number of choices, corresponding to “Who will win the U.S. Election in 2024?”
• Scalar markets are markets that resolve based mostly on whether or not one thing is greater or decrease than a specified certain, corresponding to “Will the inhabitants of the U.S. be greater or decrease than 333 million in its subsequent census?”

When collaborating in a prediction market, you’ll be able to promote your shares at any time. There’s no lockup interval, and also you aren’t required to attend till the occasion being speculated on has come to a conclusion.

Persevering with with the election instance, for those who believed that one candidate was going to completely crush the opposite in an upcoming debate, you might purchase that candidate’s tokens, anticipating them to go up in worth after the controversy, and promote them as soon as the controversy concluded. The percentages, and subsequently the value of every share, are always altering in real-time, as a result of they’re free markets, managed solely by the provision and demand of every share.

Equally, when betting on a sporting occasion, the percentages will doubtless change in real-time as the sport progresses, and the rating adjustments.

On-chain prediction markets sometimes use oracles, which take off-chain, real-world information and make it usable on a blockchain, to find out the end result of an occasion and resolve disputes. For instance, a decentralized prediction market can use an oracle to let anybody submit proof of an end result, whereas anybody can problem it.

Examples of prediction markets

Kalshi

Launched in 2018, Kalshi is the highest prediction market by quantity as of February 2026, in accordance with DeFiLlama information. The platform hit a valuation of $11 billion following a $1 billion funding spherical in November 2025.

Polymarket

Polymarket was launched in 2020 by Shayne Coplan, and made headlines when its founder was raided by the FBI in November 2024, one thing Coplan attributed to “political retribution” after the platform known as the U.S. presidential election for Donald Trump. In October 2025, Polymarket was valued at $9 billion following a $2 billion funding from Intercontinental Change. Not like Kalshi, which operates as a centralized trade, Polymarket settles markets on-chain. In February 2026, the agency filed trademark functions for POLY and $POLY, linked to a possible native token launch.

Opinion

On-chain prediction market Opinion launched in This fall 2025 on BNB Chain, with backing from Binance founder CZ’s household workplace YZi Labs. In February 2026, the platform raised $20 million in a pre-Sequence A funding spherical, backed by companies together with Hack VC and Bounce Crypto.

Myriad

Launched by Decrypt’s mum or dad firm Dastan in January 2025, on-chain prediction market Myriad goals to supply a brand new mannequin for the media ecosystem. By integrating with media shops corresponding to Decrypt and Rug Radio, Myriad envisages a dynamic participatory mannequin that, mentioned Dastan President Farokh Sarmad, realigns incentives “from the underside again up.”

Based on Dastan CEO Loxley Fernandes, Myriad allows customers to “take part within the creation of the information cycle and assist us discover sources of fact, after which, in fact, rewards them and incentivizes them for doing that.”

How does Myriad’s decentralized prediction market work?

Created by Dastan, the mum or dad firm of Decrypt and Rug Radio, Myriad is an on-chain prediction market.

There are two essential fashions for making certain liquidity in an on-chain market; order books and automatic market makers (AMMs). AMMs use a mathematical components to cost belongings, the place order books match consumers with sellers based mostly on their orders, by means of a centralized trade technique.

Myriad’s prediction market makes use of an AMM mannequin; as a result of AMMs don’t depend on a counterparty to match orders, they’ll operate even when there’s low liquidity. Any person can present liquidity for any market—versus centralized prediction markets, the place solely the centralized market maker is liable for offering all liquidity.

Advocates of on-chain prediction markets spotlight the truth that as a result of they’ll absorb liquidity from wherever, they have a tendency to have a lot liquidity than their alternate options.

On-chain prediction markets like Myriad use incentives to draw liquidity.

When a person participates in a prediction market on Myriad, they obtain shares in that market, which could be traded whereas the market stays open—enabling them to enter and exit with markets that settle over a very long time horizon.

Myriad’s fixed operate ensures that the variety of shares in a market’s liquidity pool all the time stays fixed. When an imbalance is launched by including or eradicating shares to a liquidity pool, the value of outcomes available on the market change, and shares are redistributed between the dealer or liquidity supplier, and the share swimming pools.

The way forward for prediction markets

Prediction markets are a fast-growing sector, with quantity leaping from $15.8 billion in 2024 to $63.5 billion in 2025, in accordance with a February 2026 report by blockchain safety agency CertiK.

Mainstream media has more and more regarded to prediction markets as a professional technique of predicting outcomes, with media shops just like the Wall Avenue Journal and Newsweek reporting on prediction market odds alongside conventional polls.

Decentralized prediction markets declare to be extra environment friendly than their centralized counterparts as a result of they lack intermediaries, and consequently have fewer charges. Their decentralized nature additionally permits for a better diploma of privateness than in conventional prediction markets, and plenty of prediction markets use cryptocurrency as a method of fee, making them extra accessible to gamers world wide.

That additionally implies that decentralized prediction markets have thrown up challenges for regulators, since legal guidelines round playing, securities and contracts differ between jurisdictions.

Crypto prediction markets have confronted regulatory scrutiny, with a U.S. Commodity Futures Buying and selling Fee (CFTC) spokesperson noting that, “providing or facilitating a product or exercise by the use of releasing code onto a blockchain doesn’t absolve any entity or particular person from complying with pertinent legal guidelines or CFTC rules,” in response to a query about Augur. In 2022, Polymarket was hit with a $1.4 million high quality by the CFTC, which accused the prediction market of letting individuals make bets with out being registered.

In July 2025, each the DOJ and CFTC wound down investigations into Polymarket in July 2025. Just some weeks later, the platform snapped up a U.S. choices trade, marking a “vital step towards increasing” because it eyed a return to the U.S. market, in accordance with founder and CEO Shayne Coplan.

Nonetheless, pushback internationally continues, with Polymarket going through bans in Portugal and Hungary in early 2026. Prediction markets have additionally hit roadblocks on the state stage within the U.S., with Kalshi quickly banned in Massachusetts following a preliminary injunction in January 2026 (subsequently challenged by Polymarket in federal courtroom) and Polymarket hit with a short lived restraining order from a Nevada state courtroom in February 2026.

Alongside regulatory challenges, CertiK’s report additionally cautioned that prediction markets face challenges together with wash buying and selling and hybrid safety dangers, because the sector’s speedy progress exposes structural weaknesses.

However, the sector seems to be underpinned by a generational shift, with a January 2026 survey discovering that nearly a 3rd of Individuals anticipate on-line betting to change into a “larger and extra essential a part of tradition,” with youthful customers displaying greater consciousness of prediction market platforms corresponding to Polymarket and Kalshi.

This text was written in December 2024 and up to date in February 2026.