The 2024 election was filled with new and unprecedented developments in the history of American electoral politics: A sitting President was pushed out of the race by his own party. A mixed-race woman with Black and Indian heritage took his place roughly three months before Election Day. And their opponent, a former president vying for nonconsecutive terms in office, was convicted of 34 felonies while on the campaign trail.
As the melodrama unfolded, the ups and downs of each candidate were tracked not only in the polls but for the first time in modern history by prediction markets.
The central question of whether Harris or former President Donald Trump would win the presidential election saw $3.2 billion Polymarket bets as of Election Day. The majority of bets went for Trump, with $1.3 billion wagered on the former president and $827 million on Harris. Polymarket did not respond to a request for comment.
The rise of betting markets signaled a step change in how elections were covered by the press and observed by the public. Pundits, analysts, and Wall Street investors started to factor in prediction markets to their election forecasts. The rationale was that they reflected people’s true feelings because they were putting their own money on the line. In reality that was only partially true: All betting lines fluctuate based on betting volumes as much as on the external factors that influence the race.
For example, in late July after President Joe Biden’s abysmal debate performance, Trump’s odds soared. However, a late-October rally in Trump’s odds was a result of aberrant betting behavior from just 1% of Polymarket’s users, according to Bloomberg.