BETA
Chapter 1
The wisdom of crowds
Chapter 2
From Iowa bars to crypto blockchains
Chapter 3
Pricing the presidency and world events
Chapter 4
Beyond politics
Ch 2 · From Iowa bars to crypto blockchains
nic On-Chain Prediction Markets
Trade the future on the chain (on the chain!), pricing every outcome (oh yeah!)
nic Economists George Neumann, Robert Forsythe, and Forrest Nelson founded the Iowa market using real money capped at $500 per trader.
Quiz
What was the maximum amount of money a trader could risk on the early Iowa Electronic Markets?
nic Prediction markets use live digital dashboards to price everything from elections to movie success.
Quiz
Which online prediction market simulator launched in 1996 using a virtual currency called Hollywood Dollars?
Quiz
What percentage margin of error did the virtual Hollywood Stock Exchange achieve for opening box office predictions?
Fun Fact
First digital market: The Iowa Electronic Markets let users trade via dial-up modems as early as 1992 under an academic exemption.
Quiz
Which major event in 2004 put Intrade on the global map for highly accurate real-time pricing?
Glossary
prediction market (noun)
A speculative market where individuals trade contracts based on the outcome of future events. In 1988, three University of Iowa economists created an experimental exchange to forecast presidential election outcomes.
A speculative market where individuals trade contracts based on the outcome of future events. In 1988, three University of Iowa economists created an experimental exchange to forecast presidential election outcomes.
Quiz
On which blockchain network does the decentralized prediction platform Polymarket settle its trades?
Quiz
What digital currency does Polymarket use as the primary collateral for its prediction contracts?
nic A regulated American exchange took a federal agency to court to legalize election betting in the United States.
Quiz
In what year did Kalshi win its landmark federal court case, allowing legal election prediction markets in the US?
Quiz
Which US federal agency did the prediction market Kalshi sue to allow election trading?