Prediction Markets Favor Trump Ahead of Presidential Election, But Web2 Isn’t Convinced

Between President Biden dropping out of the race and Donald Trump surviving an attempt on his life, the 2024 Election run has had it all. After months of blistering excitement and political drawing, the day is finally here.

With ballot boxes opening across the United States, polls and prediction markets across the internet are desperately trying to make sense of public sentiment. 

Apps like Polymarket and Drift Protocol’s BET have witnessed immense trading volume in the lead-up to the event, but they still reflect vastly different opinions from standard Web2 polls.

How does the internet see Election Day playing out?

Crypto Community Bets on Trump

It’s no secret that the crypto community favors Republican candidate Donald Trump. Industry leaders and crypto business operators like the Winklevoss twins, and Jesse Powell, founder of the Kraken Exchange have been vocally supportive of Trump, donating millions to his campaign.

Unsurprisingly, prediction marketplaces like Polymarket lean heavily in favor of a Donald Trump presidency. 

Both Polymarket and Drift Protocol odds suggest that Donald Trump has a 62% chance of winning the election, with these platforms witnessing over $4B in trading volume throughout October.

Given that prediction markets are blockchain-based applications, it makes sense that its users would largely align with ‘Crypto President’ Donald Trump. 

However, it needs to be said that Prediction Markets are not to be confused with traditional polls. Market participants are actively trading the outcome of the election, not simply voting for their preferred candidate.

Prediction Markets: Market Manipulation or Fair Game?

Prediction markets have drawn plenty of criticism in recent weeks, with detractors arguing that they’re vulnerable to market manipulation and cannot be used as an accurate gauge of public opinion.

Social media commentators claim that prediction markets have been manipulated to boost Trump’s popularity with the public. Detractors argue that ‘bots are now controlling the market’ and falsifying sentiment.

However, the alleged manipulation goes both ways. Some accounts have theorized that a late influx of capital in favor of Kamala Harris is a direct play by the Democrats to shore up support for the standing President.

Chaos Labs, an Oracle provider, has argued that over one-third of trading volume on Polymarket’s presidential market is artificially inflated by wash-trading. This volume is believed to come from traders aiming to manipulate odds, or secure higher token allocations in an eventual Polymarket airdrop.

Ultimately, prediction markets are not the be-all-and-end-all of public sentiment analysis. These markets simply provide a platform by which traders can express their opinions on real-world events

Traditional Polls At Deadlock

While Polymarket and Drift Protocol markets suggest that Donald Trump is a clear favorite to win the election, traditional polls paint a far closer picture.

According to RealClearPolling, an online aggregator of America’s most popular polling sources, Harris leads Trump by a whisker. 

Taking the average response from various outlets like the New York Times, Wall Street Journal, and Forbes, the RCP Index places Harris at a 48.7% chance of winning, with Trump trailing by 0.1% at 48.6%.

Whoever takes the Presidency can expect crypto to be a chief talking point throughout their term. The industry has proven its longevity and resilience over the years. With 40% of adults in the U.S. reportedly owning cryptocurrency and Bitcoin ETFs trading on Wall Street, the industry is arguably in a better position than ever.

Whether Trump or Harris is sworn into Office in January 2025, the global blockchain industry will continue to innovate and progress, regardless of the U.S. Administration’s viewpoint.

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