The American presidential election aroused the enthusiasm of users of this online betting site which “predicted” the victory claimed by Donald Trump.
“The winner of the American presidential election”, “Who will win Arizona?”, “Will Trump win all the key states?”… Here is an example of the questions on the front page of the Polymarket site. The uncertain result of the American election has done business for this predictive market platform.
It attracts thousands of bettors who can bet cryptocurrency on the outcome of a multitude of events, and therefore, in particular, the winner of the presidential election. However, for several hours, the site has experienced sudden notoriety among the general public: the site “predicted” the victory claimed by Donald Trump.
Concretely, Polymarket resembles “classic” betting sites. Except that here, to bet, users must buy shares that they pay for in USD Coin, a stable cryptocurrency pegged to the dollar. More than 3.2 billion dollars were bet on the American election, according to Le journal du Coin, a site specializing in cryptocurrencies.
The market titled “Presidential Election Winner 2024”, which “predicted” the victory of the Republican candidate, is the most popular on Polymarket. Concretely, Internet users bet by buying shares for Donald Trump or Kamala Harris. Until the results, the share price varies according to the probability of victory of each candidate. The more likely an event is to happen according to bettors, the more actions that go in this direction are worth.
Thus, the action tends towards zero if the probability of victory is zero, and closer to one dollar if the candidate has a great chance of winning, specifies BFMTV. The bet is stopped once three sources, namely NBC, Fox News and AP News, publish the result of the vote. In the end, the owners of the winning stocks pocket the money from the losing stocks.
Among these punters, an anonymous Frenchman stood out, according to the New York Times. He created four accounts that together hold more than $28 million in stocks betting on Donald Trump's victory over Kamala Harris. These four accounts are among the five biggest profiles to bet on the victory of the Republican candidate.
The Polymarket platform is controversial as it can lead to biased interpretations. Indeed, the more shares a punter buys, the more his opinion will weigh on the market. And, the evolution of the actions of each camp being displayed in the form of percentages and graphs, these can lead people to believe, wrongly, that it is a survey, which the platform denies.
Despite the enthusiasm that Polymarket generates, the site is not authorized in the United States. Punters are therefore theoretically from outside the country, unless they circumvent this ban, via a VPN for example. There is legal uncertainty around electoral betting in the country. This is one of the reasons for the legal vagueness that exists around electoral betting in the United States.
Their detractors worry about the risks of corruption and gamification of the political system. Until recently, gambling was therefore prohibited there, but a court decision at the beginning of October authorized Kalshi, another political betting platform, to accept bets from Americans. This could pave the way for other sites, such as Polymarket.
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