An NBC News analysis found that in this election cycle, approximately $200 million has been wagered in prediction markets, where users have bet on election outcomes across the country.
According to the Commodity Futures Trading Commission (CFTC), a prediction market is a platform where users buy and sell contracts tied to the outcome of future events. The price of a contract reflects the market-implied probability of an outcome.
For example, a contract trading at 55 cents implies the market estimates a 55% chance the event will occur. Trading volume reflects how actively a market is being traded. Prediction markets are speculative, which means market prices do not guarantee the outcome of an event.
