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Parcae
Glossary platform

Prediction Market

In short: A trading platform where users buy and sell binary contracts on event outcomes. A YES contract pays $1 if the event occurs and $0 if it doesn't; the current price reflects the crowd's estimated probability. Kalshi, Polymarket, and PredictIt are the leading prediction markets.

Prediction markets offer prices on events that traditional sportsbooks don’t cover (politics, economics, weather) and can also create arbitrage opportunities against sportsbooks on overlapping events. Their crowd-driven prices often diverge meaningfully from sportsbook odds.