Editorial review: June 1, 2026. See our editorial policy.
Prediction markets let users take positions on future outcomes. The exact mechanics depend on the product: one platform may use peer-to-peer shares, another may list regulated event contracts, and a sportsbook feature may use fixed odds instead.
The basic idea
1. Choose a question
A market is built around an event outcome, such as an election result, a sports event, a crypto price threshold, or an economic release.
2. Take a position
Depending on the platform, you may buy outcome shares, trade event contracts, or place a fixed-odds sportsbook bet.
3. Follow the resolution rules
The market settles using its published rules and source. Winning positions pay out according to the product terms; losing ones may settle at zero.
Prices can represent probability
On share-based markets, a price between $0.00 and $1.00 often acts as an implied probability. A Yes share trading at $0.65 suggests the market is pricing roughly a 65% chance of that outcome. It is a market price, not a guarantee.
Liquidity affects early exits
Being right eventually is not the only question. If you want to exit before resolution, the available buyers, sellers, and spread can affect the price you receive. Fixed-odds sportsbook products work differently because they do not depend on peer-to-peer liquidity in the same way.
Why product labels can mislead
Polymarket’s international platform uses peer-to-peer outcome shares. BETBY’s official announcement describes a different model: fixed-odds non-sports markets inside a sportsbook interface, without peer-to-peer liquidity pools. Start with the mechanics, then compare the brand.
Resolution rules matter more than the headline
Read the full market rules before taking a position. Check the resolution source, deadline, edge cases, and dispute process. Polymarket’s official documentation, for example, says its markets use pre-defined rules and the UMA Optimistic Oracle process.
What to compare before using a platform
Eligibility
Check country, province, territory, or state rules. Do not treat website access as proof that trading is allowed.
Fees and funding
Check trading fees, deposit and withdrawal routes, network costs, and any third-party charges.
Custody
Understand who holds funds or collateral and what wallet, account, or transfer risks apply.
Responsible-use tools
Look for limits, timeouts, self-exclusion, and current support resources where available.
Frequently asked questions
Can I lose money?
Yes. A position can lose value or settle at zero, and fees or limited liquidity can affect the result.
Can I use a VPN if a platform blocks my location?
No. Do not use a VPN or similar tool to bypass a location restriction.
Is this investment advice?
No. This guide is informational. Confirm the platform terms and rules directly before acting.