Prediction Markets Surge Ahead: $606 Million Bet on 2024 Presidential Race Outpaces Traditional Polls

Prediction Markets Outperform Polls in Election Forecasting, Expert Says

As the 2024 U.S. presidential election approaches, prediction markets are emerging as a potentially more accurate forecasting tool than traditional polling methods, according to a Rutgers University professor. With over $606 million already wagered on the election outcome on Polymarket, the markets are currently favoring a Harris victory.

Harry Crane, a statistics professor at Rutgers, suggests that looser regulation would allow for increased participation and reduce the risk of market manipulation. “Prediction markets have historically been more accurate than traditional polling,” Crane stated, pointing to their success in forecasting the last few presidential cycles.

Recent events, including an attempted assassination against Trump, President Joe Biden stepping down and endorsing Kamala Harris, and both candidates selecting their running mates, have significantly impacted polling. Prediction markets, however, have demonstrated a quicker ability to reflect these adjustments.

Polymarket, a leading prediction market platform, accurately forecasted a 70% chance of President Biden dropping out as far back as July 4. This ability to rapidly factor in new information is expected to prove particularly valuable on election night.

The user base investing in these markets is diverse, ranging from recreational bettors to professional syndicates and even companies hedging risk based on candidates’ proposed policies. With $606.5 million at stake on Polymarket alone, participants are highly motivated to stay informed about election developments.

Crane believes that full legalization of prediction markets in the U.S. could further enhance their accuracy. Currently, most popular prediction markets are largely inaccessible to U.S. participants, with PredictIt operating under limited conditions set by the Commodity Futures Trading Commission.

“More participation could make manipulation less likely,” Crane explained, advocating for the removal of limitations to create “better, cleaner, and more accurate markets.”

As the election draws nearer, the role of prediction markets in forecasting outcomes may become increasingly significant, potentially reshaping how we understand and interpret electoral trends.