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

Prediction markets such as Myriad, launched by Decrypt‘s parent company Dastan, have rapidly gained traction in recent years, enabling users to predict the outcomes of everything from crypto market movements to geopolitical events.

So what exactly are prediction markets? Read on to find out.

What are prediction markets?

Prediction markets have existed in one form or another since the 16th century. They allow users to speculate on the outcome of any future event—as long as someone has set up a market for it.

Users can attempt to predict the outcome of sporting events, elections, legal cases, and anything with a clear or provable outcome. The core concept is very simple: if your prediction is right, you win money. If you’re wrong, you lose the money you put up to back your prediction.

The mechanics that underpin them are deceptively simple. The price of one “share” in a prediction market ranges from between $0.00 to $1, and its price correlates to its percentage chance of winning, or its “odds.”

For example, if a share for one candidate in an election costs 63 cents, that candidate has a 63% chance of winning, according to this specific market. If you want to predict the outcome of the election, you’d buy shares of whichever candidate you think will win. When the election is over, the market will resolve, and the price will go to $1.00 per share for whichever candidate won. The lower the odds of something happening, the cheaper making predictions on it will become, and vice versa.

There are several different types of prediction market.

• Binary markets are markets with two options that will resolve to either $1 or 0 (yes, or no), such as “Will it rain on Monday of next week”?
• Categorial markets are markets with multiple options, such as “Who will win the U.S. Election in 2024?”
• Scalar markets are markets that resolve based on whether something is higher or lower than a specified bound, such as “Will the population of the U.S. be higher or lower than 333 million in its next census?”

When participating in a prediction market, you can sell your shares at any time. There’s no lockup period, and you aren’t required to wait until the event being speculated on has come to a conclusion.

Continuing with the election example, if you believed that one candidate was going to absolutely crush the other in an upcoming debate, you could buy that candidate’s tokens, expecting them to go up in price after the debate, and sell them once the debate concluded. The odds, and therefore the price of each share, are constantly changing in real-time, because they’re free markets, controlled only by the supply and demand of each share.

Similarly, when betting on a sporting event, the odds will likely change in real-time as the game progresses, and the score changes.

On-chain prediction markets typically use oracles, which take off-chain, real-world data and make it usable on a blockchain, to determine the outcome of an event and resolve disputes. For example, a decentralized prediction market can use an oracle to let anyone submit proof of an outcome, while anyone can challenge it.

Examples of prediction markets

Kalshi

Launched in 2018, Kalshi is the top prediction market by volume as of February 2026, according to DeFiLlama data. The platform hit a valuation of $11 billion following a $1 billion funding round 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, something Coplan attributed to “political retribution” after the platform called the U.S. presidential election for Donald Trump. In October 2025, Polymarket was valued at $9 billion following a $2 billion investment from Intercontinental Exchange. Unlike Kalshi, which operates as a centralized exchange, Polymarket settles markets on-chain. In February 2026, the firm filed trademark applications for POLY and $POLY, linked to a potential native token launch.

Opinion

On-chain prediction market Opinion launched in Q4 2025 on BNB Chain, with backing from Binance founder CZ’s family office YZi Labs. In February 2026, the platform raised $20 million in a pre-Series A funding round, backed by firms including Hack VC and Jump Crypto.

Myriad

Launched by Decrypt’s parent company Dastan in January 2025, on-chain prediction market Myriad aims to offer a new model for the media ecosystem. By integrating with media outlets such as Decrypt and Rug Radio, Myriad envisages a dynamic participatory model that, said Dastan President Farokh Sarmad, realigns incentives “from the bottom back up.”

According to Dastan CEO Loxley Fernandes, Myriad enables users to “participate in the creation of the news cycle and help us find sources of truth, and then, of course, rewards them and incentivizes them for doing that.”

How does Myriad’s decentralized prediction market work?

Created by Dastan, the parent company of Decrypt and Rug Radio, Myriad is an on-chain prediction market.

There are two main models for ensuring liquidity in an on-chain market; order books and automated market makers (AMMs). AMMs use a mathematical formula to price assets, where order books match buyers with sellers based on their orders, through a centralized exchange method.

Myriad’s prediction market uses an AMM model; because AMMs don’t rely on a counterparty to match orders, they can function even when there’s low liquidity. Any user can provide liquidity for any market—as opposed to centralized prediction markets, where only the centralized market maker is responsible for providing all liquidity.

Advocates of on-chain prediction markets highlight the fact that because they can take in liquidity from anywhere, they tend to have much liquidity than their alternatives.

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

When a user participates in a prediction market on Myriad, they receive shares in that market, which can be traded while the market remains open—enabling them to enter and exit with markets that settle over a long time horizon.

Myriad’s constant function ensures that the number of shares in a market’s liquidity pool always remains constant. When an imbalance is introduced by adding or removing shares to a liquidity pool, the price of outcomes on the market change, and shares are redistributed between the trader or liquidity provider, and the share pools.

The future of prediction markets

Prediction markets are a fast-growing sector, with volume jumping from $15.8 billion in 2024 to $63.5 billion in 2025, according to a February 2026 report by blockchain security firm CertiK.

Mainstream media has increasingly looked to prediction markets as a legitimate means of predicting outcomes, with media outlets like the Wall Street Journal and Newsweek reporting on prediction market odds alongside traditional polls.

Decentralized prediction markets claim to be more efficient than their centralized counterparts because they lack intermediaries, and as a result have fewer fees. Their decentralized nature also allows for a higher degree of privacy than in traditional prediction markets, and many prediction markets use cryptocurrency as a means of payment, making them more accessible to players around the world.

That also means that decentralized prediction markets have thrown up challenges for regulators, since laws around gambling, securities and contracts differ between jurisdictions.

Crypto prediction markets have faced regulatory scrutiny, with a U.S. Commodity Futures Trading Commission (CFTC) spokesperson noting that, “offering or facilitating a product or activity by way of releasing code onto a blockchain does not absolve any entity or individual from complying with pertinent laws or CFTC regulations,” in response to a question about Augur. In 2022, Polymarket was hit with a $1.4 million fine by the CFTC, which accused the prediction market of letting people make bets without being registered.

In July 2025, both the DOJ and CFTC wound down investigations into Polymarket in July 2025. Just a few weeks later, the platform snapped up a U.S. options exchange, marking a “significant step toward expanding” as it eyed a return to the U.S. market, according to founder and CEO Shayne Coplan.

However, pushback internationally continues, with Polymarket facing bans in Portugal and Hungary in early 2026. Prediction markets have also hit roadblocks at the state level in the U.S., with Kalshi temporarily banned in Massachusetts following a preliminary injunction in January 2026 (subsequently challenged by Polymarket in federal court) and Polymarket hit with a temporary restraining order from a Nevada state court in February 2026.

Alongside regulatory challenges, CertiK’s report also cautioned that prediction markets face challenges including wash trading and hybrid security risks, as the sector’s rapid growth exposes structural weaknesses.

Nevertheless, the sector appears to be underpinned by a generational shift, with a January 2026 survey finding that almost a third of Americans expect online betting to become a “bigger and more important part of culture,” with younger consumers showing higher awareness of prediction market platforms such as Polymarket and Kalshi.

This article was written in December 2024 and updated in February 2026.