How Accurate Was Polymarket During the US Election?
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Key takeaways:
- Polymarket accurately predicted major outcomes in the U.S. election, outperforming traditional polls in key swing states.
- While Polymarket proved effective, it missed predicting the popular vote winner.
- Post-election, Polymarket’s activity dropped greatly as attention shifted away from high-stakes markets.
In the run-up to the US election, there was quite a bit of cynicism toward Polymarket — a crypto-powered site where users can place bets on the outcome of future events.
The platform had loftily been described as a superior alternative to opinion polls and a more accurate barometer of political reality than the mainstream media.
However, critics have argued that its data has been distorted by wash trading, with a small number of whales placing outsized bets that skewed odds in Donald Trump’s favor.
With the world digesting news that Trump will serve a second term as president, Polymarket has not just survived its first major test but passed with flying colors.
Opinion pollsters are now beginning a grim post-mortem to assess how they could be wrong about the US political landscape. Until election day, survey after survey suggested that “basically a coin toss” separated Trump and rival Kamala Harris.
But at 9 a.m. ET on Tuesday, as Americans began to cast their ballots, Polymarket’s live odds were already showing a distinct edge for the Republican candidate.
Polymarket’s edge continued as results were counted and verified.
The Associated Press news agency has been declaring the winners of US elections since the mid-1800s, making calls when it is mathematically certain there is a victor.
Although AP’s results are used to verify payouts before they are made, Polymarket argues its users knew the outcome in key swing states hours earlier.
In that graphic above, Polymarket says its equivalent of calling a race is when a candidate has more than a 95% chance of winning.
The site says it “called” North Carolina 90 minutes before AP — and the overall winner a full nine hours earlier. And while this wire service maintains that Arizona is too close to call, it’s already a foregone conclusion in Polymarket’s eyes.
Overall, there was widespread expectation that the eventual victor in this hard-fought campaign would be determined by seven battleground states: Michigan, Wisconsin, Pennsylvania, Nevada, Arizona, North Carolina, and Georgia.
No opinion poll or political pundit would have predicted that there would be a red sweep across them all — but as things stand, Trump has won five of them and is ahead in the other two.
Polymarket’s odds accurately gave Trump an edge on Tuesday morning — putting his chances at 70% in Georgia and 61% in the crucial state of Pennsylvania, which carries 19 electoral votes.
That being said, the site didn’t get every call right. When Cryptonews took these screenshots at 9 a.m. ET on election day, Harris was tipped to secure Wisconsin and Michigan. In the end, Trump won 25 Electoral College votes from both states, and each victory was fairly narrow.
And powerfully illustrating how the wisdom of the masses isn’t always a crystal ball into the future, Polymarket had one big miss: which candidate would win the popular vote.
The popular vote is a different metric from the Electoral College. It refers to which candidate secured the most ballots nationwide.
It’s possible to reach the magic number of 270 electoral votes and win the presidency without most Americans’ support, as Donald Trump did in 2016.
Interestingly, while Polymarket said Trump had a 61.7% chance of securing a second term as of Tuesday morning, just 26% believed that he would also win the popular vote.
The latest figures from NBC News suggest he managed both—the president-elect gained 72.6 million votes compared to his rival’s 67.9 million.
What Next for Polymarket?
After more than $3.5 billion was spent wagering on the US election, Polymarket seems a bit more subdued now.
Attention has now turned to what Trump’s priorities may be after he’s inaugurated on January 20, but each of these markets has dramatically smaller trading volumes by comparison.
Just $431,000 has been wagered on whether Trump will give Elon Musk a seat in the cabinet, with $155,700 bet on who the president-elect will pardon when he returns to power. Both are listed as “top” markets on its homepage.
While the presidential election winner was by far the most popular market on Wednesday, Thursday’s was focused on who might win the Super Bowl in 2025.
Despite Polymarket’s goal of differentiating itself from 24-hour news channels, it turns out they share one thing: both only get attention when something’s happening.
Although this betting platform might have had an easier regulatory ride during the Trump administration, it could face headaches in other jurisdictions.
Reports suggest that France could ban Polymarket altogether and block its domain amid concerns that it would violate the country’s gambling legislation.
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