Finance:PredictIt

From HandWiki

PredictIt is a New Zealand-based online prediction market that offers exchanges on political and financial events.[1] PredictIt is owned and operated by Victoria University of Wellington[2] with support from Aristotle, Inc.[3] The company's office is located in Washington, D.C.[4] Only United States citizens can bet on the site. The market was initially launched on 3 November 2014.[1][4]

History

PredictIt was first launched on 3 November 2014.[1] By March 2016, the website had approximately 29,000 active traders.[5] By 2025, PredictIt had 400,000 active users.[6]

During the 2016 United States elections, PredictIt, along with other prediction market websites, received attention from various media outlets.[5][7][8]

Regulation

To launch the site, the nonprofit educational project of the Victoria University of Wellington, New Zealand, "had to work around federal laws that prohibit online gambling and govern commodity futures trading."[9] To this end, Victoria University of Wellington secured a no-action letter from the Commodity Futures Trading Commission (CFTC),[10] eliminating the risk of prosecution for illegal online gambling.[11] In order to secure the no-action letter, each question was limited to 5,000 traders, and there was an $850 cap on individual investments per question.[2] These restrictions were modeled after the Iowa Electronic Markets, which previously secured a no-action letter from the Commodity Futures Trading Commission.[11] However, there were differences in the restrictions between the two markets.[10]

On 4 August 2022, the CFTC announced that Victoria University has not operated PredictIt in compliance with the terms of the no-action letter and as a result the no-action letter had been withdrawn. The CFTC stated that all related and remaining listed contracts and positions on PredictIt should be closed out and/or liquidated no later than 11:59 p.m. (EDT) on 15 February 2023.[12] In September 2022, PredictIt and Aristotle International filed suit against the CFTC in the U.S. District Court for the Western District of Texas to block the action.[13][non-primary source needed] On 26 January 2023, the Fifth Circuit granted a temporary injunction allowing PredictIt to continue operating while the court considered further term relief for the organization.[14][non-primary source needed] In July 2025, PredictIt won its lawsuit against the CFTC.[15]

In September 2025, PredictIt received full regulatory approval from the CFTC to operate as a designated contract market (DCM) and derivatives clearing organization (DCO).[6][16] The company is expected to launch a new, expanded prediction market in late 2025.[6]

Trading format

PredictIt uses a continuous double auction to sell shares for each event in its markets, meaning that for every person who predicts that an event will take place, there must be another person who predicts that it will not. The site groups related predictions into a market.[17] Operating expenses are covered by charging a fee of 10% on earnings in excess of the original investment and by charging an additional 5% withdrawal fee.[18] PredictIt has many different categories of markets including questions about the Biden administration,[19] U.S. elections,[20] Congress,[21] state/local elections,[22] and world.[23] Questions vary from asking which political party will win certain elections, which candidate will win, what the margin of victory for the winner will be, and even what the results of future polls on RealClearPolitics and FiveThirtyEight will be.[24]

Data-sharing program

PredictIt offers a data sharing program for members of the academic community. PredictIt has over 160 data partners, including researchers affiliated with Duke University, Harvard University, the Massachusetts Institute of Technology, the Oklahoma State University, the University of Michigan, the University of Pennsylvania, the University of Virginia, and Yale University.[25]

See also

References

  1. ↑ 1.0 1.1 1.2 "New prediction market tabs Jeb Bush as frontrunner for 2016 GOP nomination". SaintPetersBlog. 2014-11-03. http://www.saintpetersblog.com/archives/165516. Retrieved 2015-01-25. 
  2. ↑ 2.0 2.1 "Terms And Conditions". PredictIt. https://www.predictit.com/Home/TermsAndConditions. Retrieved 2015-01-25. 
  3. ↑ "What Is PredictIt?". PredictIt. https://www.predictit.com/About/WhatIsPredictIT. Retrieved 2015-01-25. 
  4. ↑ 4.0 4.1 Patrick O'Connor (2015-08-21). "Online Exchange Shows Jeb Bush as the GOP's 2016 Favorite". The Wall Street Journal. https://blogs.wsj.com/washwire/2015/08/21/online-exchange-shows-jeb-bush-as-the-gops-2016-favorite/. Retrieved 2015-08-24. 
  5. ↑ 5.0 5.1 Jessica Contrera (2016-03-28). "Here's how to legally gamble on the 2016 race". The Wall Street Journal. https://www.washingtonpost.com/lifestyle/style/heres-how-to-legally-gamble-on-the-2016-race/2016/03/28/14397dde-f1dc-11e5-85a6-2132cf446d0a_story.html. Retrieved 2016-11-17. 
  6. ↑ 6.0 6.1 6.2 Métivier, Ryan (2025-09-12). "PredictIt Next To Launch Prediction Markets After CFTC Approval" (in en-US). https://www.thesportsgeek.com/news/predictit-cftc-approval/. 
  7. ↑ Andrew McGill (2016-05-11). "The People Who (Still) Bet Trump Won't Win the Nomination". The Atlantic. https://www.theatlantic.com/politics/archive/2016/05/the-people-who-still-bet-trump-wont-win-the-nomination/482148/. Retrieved 2016-11-17. 
  8. ↑ Rory O'Connor (2016-02-18). "Something better than polls for political predictions? You bet!". PBS. https://www.pbs.org/newshour/show/something-better-than-polls-for-political-predictions-you-bet. 
  9. ↑ Bachman, Katy (2014-10-31). "Meet the 'stock market' for politics". Politico. https://www.politico.com/story/2014/10/predictit-online-politics-stock-market-112374. Retrieved 2017-11-15. 
  10. ↑ 10.0 10.1 "CFTC Staff Provides No-Action Relief for Victoria University of Wellington, New Zealand, to Operate a Not-For-Profit Market for Event Contracts and to Offer Event Contracts to U.S. Persons". U.S. Commodity Futures Trading Commission. 2014-10-29. https://www.cftc.gov/PressRoom/PressReleases/7047-14. 
  11. ↑ 11.0 11.1 Katy Bachman (2014-10-31). "Meet the 'stock market' for politics". Politico. https://www.politico.com/story/2014/10/predictit-online-politics-stock-market-112374.html. 
  12. ↑ "CFTC Staff Withdraws No-Action Letter to Victoria University of Wellington, New Zealand Regarding a Not-For-Profit Market for Certain Event Contracts". https://www.cftc.gov/PressRoom/PressReleases/8567-22. 
  13. ↑ Travis, Brandi (2022-10-06). "Additional Plaintiffs Join 'Predictit' Lawsuit Against CFTC". Global Newswire (Press release). Retrieved 2022-11-01.
  14. ↑ Aristotle (2023-01-27). "Fifth Circuit Grants Injunction Allowing PredictIt Market to Continue Operating". GlobeNewswire News Room (Press release). Retrieved 2023-01-27.
  15. ↑ Zormelo, Elorm (2025-07-31). "Federal Court Rules for PredictIt Event Contracts Market in Action Against CFTC". https://content.next.westlaw.com/practical-law/document/Ie2536a0a6c7b11f0a273f7b3de17c00e/Legal-Update-Federal-Court-Rules-for-PredictIt-Event-Contracts-Market-in-Action-Against-CFTC. 
  16. ↑ Beyoud, Lydia (2025-09-05). "PredictIt Gains CFTC Approval to Launch Regulated Exchange" (in en). Bloomberg News. https://www.bloomberg.com/news/articles/2025-09-05/predictit-gains-cftc-approval-to-launch-regulated-exchange. 
  17. ↑ "How It Works". PredictIt. https://www.predictit.com/About/HowItWorks. Retrieved 2015-01-25. 
  18. ↑ "PredictIt". https://www.predictit.org/support/how-to-trade-on-predictit. 
  19. ↑ "PredictIt". https://www.predictit.org/markets/3/Biden-Administration. 
  20. ↑ "PredictIt". https://www.predictit.org/markets/17/US-Elections. 
  21. ↑ "PredictIt". https://www.predictit.org/markets/2/Congress. 
  22. ↑ "PredictIt". https://www.predictit.org/markets/16/State-Local. 
  23. ↑ "PredictIt". https://www.predictit.org/markets/5/World. 
  24. ↑ "PredictIt". https://www.predictit.org/markets/0?filterIds=61&sort=traded&sortParameter=TODAY. 
  25. ↑ "Research Opportunities". https://www.predictit.org/research. 



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