Prediction Markets: 72% Chance of Trump Winning After Shooting

The assassination attempt against Donald Trump at a rally in Pennsylvania on Saturday appeared to have boosted his chances of becoming president. PolymarketThe world’s largest prediction market saw the odds of him winning the election rise from 60% to 72%, with the near-success appearing to boost public support for Trump.

According to the same market, Biden’s chances have increased slightly, to 18%, while the chances of Vice President Kamala Harris replacing Biden and emerging victorious have decreased sharply, from 13% to 5%. PredictTrump’s chances rose to 67%, and Biden’s fell to 26%.

What are prediction markets?

Prediction markets, also called betting markets, are markets where traders trade contracts that pay out based on the outcomes of unknown future eventsThe prices generated by these contracts are like a collective prediction of market participants. Thus, the price corresponds to the probabilities. For example, Trump’s stock is trading at 72 cents, which indicates a 72% chance that he will win.

If the best trader believes that Trump’s actual chances of winning are greater than 72%, he or she will buy “Yes” shares at 72 cents each. If Trump wins, each “Yes” share will be worth $1, creating a profit of 28 cents per share. In this case, anyone who buys “No” shares would see their investment become worthless. Traders can buy and sell their shares at any time before the outcome, changing the stock price and therefore the odds.

Of all the prediction markets, Polymarket aims to be transparent and reliable. The platform is decentralized and built on the Ethereum blockchain, and users place bets with stablecoins. In May, the company announced that it had raised over $70 million in its Series A and B funding rounds, with Ethereum founder Vitalik Buterin among the investors.

Polls paint a different picture of the election outcome, with Five Thirty-eight predict that Trump has only a two-point lead over Biden. But research suggests Prediction markets may be, on average, “better predictors” of political outcomes. That’s because traders combine all the available information (news, polls, and expert opinions) and make trades based on that combined knowledge. The economic incentive should mean that “the more savvy traders participate, the more the market price (probability) will change to more accurately reflect the true current probabilities,” according to Polymarket’s website.

In light of this, Polymarket creates markets for users to bet on virtually anything: “Your job is to find markets where you disagree with the current odds and profit by betting on your beliefs.

This includes a market for “Who will ask Biden to step down??” with Joe Manchin trading at 62 cents. There are markets for the number of times Elon Musk will tweet in a week. Will Taylor Swift Get Engaged In 2024? The Market Says There Is A 38% chance. Will the identity of Satoshi, the author of the Bitcoin white paper, be proven? Unsurprisingly, traders have predicted that the chances of this happening are very low. Less than 1%.

Trump Stocks and Cryptocurrencies Are On the Rise

Another indicator that the shooting could work in Trump’s favor in the long run is the market’s reaction. For example, the cryptocurrency market rallied as Trump doubled down on his promise to be the “crypto president” if re-elected. After the shooting at 6:15 p.m. EST, Bitcoin rose 6%, breaking through $63,000 on Monday morningfor the first time in three weeks, according to data from CoinGecko. Similarly, cryptocurrency-related stocks also climbed. Coinbase Global, Marathon Digital Holdings and Riot Platforms increased by 10%, 7% and 6% respectively.

Similarly, the stock price of a company owned by Trump is rising. Shares of Trump Media and Technology, the parent company of Truth Social, rose 47% from Friday’s closing price through Monday morning, but have since pulled back, now trading at $41.35. Still, that’s a 32% increase from last week. That hypothetically added $1.8 billion to his total wealth, according to The telegraph.

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