The 2024 election was a resounding victory not only for Donald J. Trump but also for prediction markets like the crypto-based Polymarket, which allow users to trade contracts that pay out based on the outcome of future events.
By the morning of the election, Polymarket showed $1.8 billion in trading volume on who would win the presidency (Trump at 62%) and an additional half billion on who would win the popular vote (Harris at 73%). The biggest bet on a Trump victory was placed by an enigmatic “whale” known only as Théo.
Trump’s victory was even more decisive than the prediction markets foresaw. Even on Polymarket, few shared Théo’s conviction that Trump would win the popular vote. But the prediction markets were still a lot closer than most opinion polls and political pundits, nearly all of which clustered around a neck-and-neck result.
The Wall Street Journal reported on Election Day that “Prediction Markets Point to Likely Trump Victory,” giving the former president a chance of success between 57% and 62%. But most polls showed the election as headed for a tie. Renowned election forecaster Nate Silver wrote on election morning: “We ran 80,000 simulations tonight. Harris won in 40,012,” thereby giving the sitting vice president a 50.015% chance of winning the election.
Nope.
“How the Trump Whale and Prediction Markets Beat the Pollsters in 2024.” Did you know that betting on elections is older than opinion polls? And why it’s more likely to predict the result? My latest for @WSJ with @mrinconcruz. https://t.co/GqYQP2MmJo
— Niall Ferguson (@nfergus) November 15, 2024
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