A new report from Bernstein Research highlights the growing influence of blockchain-based prediction markets in forecasting the 2024 U.S. presidential election.
The report, authored by analysts Gautam Chhugani and Mahika Sapra, points to Polymarket as a leading example of how blockchain technology is bringing increased transparency and efficiency to political betting markets.
"Polymarket has built the world's largest election prediction market on Blockchain (Ethereum-Polygon). Polymarket is a great demonstration of a public blockchain based product that works and has scaled,” the report stated.
The analysts note that Polymarket's largest prediction pool for the 2024 election has attracted over $200 million in bets.
Current odds show former President Donald Trump leading with a 63% chance of victory, while President Joe Biden's chances have declined sharply to 18% over the past month.
"The value for a Biden share has dramatically declined by more than 50% from $0.39 just a month back to $0.18 today," the report states.
Other notable markets on Polymarket include predictions for the Democratic nominee, Republican VP nominee, and whether Biden will drop out of the race. The report highlights how these markets have seen significant movement following recent events like presidential debates.
The Bernstein analysts argue that Polymarket's success demonstrates the potential for blockchain technology to create more liquid and efficient prediction markets.
"What is most impressive about Polymarket is how the product abstracts away the complexity of the blockchain user experience and feels like any tech product running on a centralised database,” the analysts write. “Polymarket odds are being quoted as 'default' by the media in calling election dynamics."
They also note the irony that crypto policy has become a partisan issue in the election, with Trump courting crypto voters and the current administration taking a tougher regulatory stance. Meanwhile, blockchain-based platforms like Polymarket are "leading to greater appreciation of the technology and its significance to politics" by bringing increased transparency to election forecasting.
The report suggests that as the 2024 election approaches, these blockchain-powered prediction markets may play an increasingly important role in shaping public perception and media coverage of the race.
Their ability to aggregate real-time sentiment and create liquid markets around political outcomes offers a new lens through which to view the electoral landscape.
Edited by Stacy Elliott.