Because of speculation over Joe Biden’s future in the 2024 presidential race, memecoins tied to potential successors like Kamala Harris have surged, which contrasts with volatile trajectories of Biden-inspired “Joe Boden” and “MAGA” coins.

As the United States enters election season, it’s becoming evident that both campaigns are using crypto funds and conversions much more than in previous years. 

According to recent reports, there is speculation about Biden considering his future in the 2024 race, causing traders on Polymarket to raise the odds of the Democrat dropping out to nearly 80% on Wednesday, up from 55% earlier. 

This sudden increase follows a week of volatility in Polymarket’s “Biden drops out of presidential race?” market, which has attracted nearly $10 million in bets. Before last week’s debate with Donald Trump, the odds of the same question were at 20%.

What’s the buzz around decentralized prediction markets for the 2024 elections? See how you can predict the next president and cash in on your insights.

Ever wondered if you could predict the outcome of an event and profit from your foresight? Decentralized prediction markets make that possibility a reality. Recently, these markets have seen explosive growth, particularly with the 2024 U.S. presidential elections approaching.

Polymarket, a leading crypto-based prediction market platform, has experienced a dramatic surge in activity. According to Dune Analytics, Polymarket’s volume surpassed $100 million in June alone, marking a record month in the platform’s breakout year.

The surge continued into July, with bets worth $9.3 million placed on the first day alone. This single-day volume exceeded typical monthly volumes seen on Polymarket last year, which ranged between $3 million and $8 million.

From January to May 2024, monthly volumes at Polymarket ranged between $40 million and $60 million, marking a gigantic increase of 7 to 12 times compared to the previous year’s monthly volumes. In June, $111 million in bets were placed, the highest ever for the platform.

One of the most popular contests on Polymarket is the “Presidential Election Winner 2024,” which has attracted bets worth over $208 million since its inception. Currently, the odds favor Donald Trump at 66% and Joe Biden at 21%.

Analysts at research and brokerage firm Bernstein note that blockchain-based platforms like Polymarket are amplifying the efficiency of election markets by providing transparency and liquidity. They mentioned this in a recent note to clients, highlighting how Polymarket, built on blockchain technology, is increasing public appreciation of crypto’s role in politics.

With such heightened interest in these platforms, let’s delve deeper into how they operate, explore notable bets, identify the leading platforms, and discover how you can participate and potentially profit without placing bets.

What are decentralized prediction markets and how do they work?

Decentralized prediction markets are betting platforms that allow people to bet on the outcomes of real-world events using blockchain technology. 

These markets operate on decentralized networks, which means there is no central authority controlling the transactions. Instead, they use smart contracts—self-executing contracts with the terms of the agreement directly written into code. This ensures that all transactions are transparent, secure, and tamper-proof.

One of the most popular decentralized prediction markets is Polymarket. Polymarket runs on the Ethereum (ETH) Layer 2 (L2) network, Polygon (MATIC), and allows users to speculate on various events, such as political outcomes, entertainment, and sports, using the stablecoin USDC. This integration ensures liquidity and stability in transactions.

Polymarket uses an automated market maker (AMM) pool model similar to Uniswap (UNI). Liquidity providers supply on-chain market liquidity, and users trade these tokenized shares to place their bets. 

For example, if you believe a particular candidate will win an election, you can buy “Yes” shares at a price reflecting the current market odds. If the event occurs as you predicted, you gain profits. If not, you suffer losses. This system allows you to profit from your knowledge and predictions about various events.

Polymarket isn’t the only player in the decentralized prediction market space. Platforms like Augur and Hedgehog also offer similar services, allowing users to speculate on a variety of events. 

Augur, for instance, operates on the Ethereum blockchain and uses a native token (REP) for betting. Hedgehog is another emerging platform, leveraging the same principles of decentralized betting with a focus on user-friendly interfaces and diverse market offerings.

Popular bets on polymarket

The buzz around the 2024 US presidential election has driven a flurry of activity on Polymarket. Let’s delve into some of the most popular bets making rounds and what they reveal about public sentiment.

Biden’s lackluster debate performance

The first presidential debate on June 27, 2024, marked a critical change in betting patterns on Polymarket. Joe Biden’s performance, widely criticized as one of the weakest since the era of televised debates began, sparked a surge in bets. 

Before the debate, Biden had a 91% chance of being the Democratic nominee. However, following his performance, this dropped to 71%, with over $21.2 million bet on Biden and $5.06 million on Kamala Harris, who has garnered 11% support until now.

Simultaneously, the probability of Biden dropping out of the race increased sharply from 19% before the debate to 44% by July 1. Although it has slightly improved to 35%, the volatility reflects the uncertainty surrounding his campaign.

On the Republican side, the betting sentiment is overwhelmingly in favor of Trump. With over $6.6 million in bets, Trump is predicted to have a 99% chance of becoming the Republican nominee, contrasting sharply with the fluctuating confidence in Biden’s campaign.

Swing states predictions

Swing states are crucial in determining the election outcome, and Polymarket’s prediction polls indicate a Republican sweep in key states. 

For instance, Republicans are predicted to win Nevada (71%), Michigan (53%), Pennsylvania (58%), Arizona (73%), Wisconsin (56%), Georgia (80%), and North Carolina (83%). 

With over $3 million in total bets backing these predictions, the Republican Party has emerged as the clear winner in all these battleground states.

There’s also a notable prediction regarding international affairs: there’s a 56% chance that Israel will invade Lebanon before September, adding fuel to the already complex geopolitical situations across the world.

How to make money from decentralized betting markets? 

Decentralized prediction markets offer opportunities to make money, but they also come with very high risks. Here’s how you can profit from these platforms, along with some important advice.

Becoming a liquidity provider

One of the easiest ways to make money on platforms like Polymarket is by becoming a liquidity provider. Here’s how it works:

• Deposit USDC: You can deposit USDC into the platform’s liquidity pool.
• Earn fees: By providing liquidity, you earn a share of the trading fees whenever users place bets.
• Automated market maker (AMM): The platform uses an AMM model, ensuring that your funds are used to facilitate trades and bets efficiently.

This method provides a steady stream of income without directly betting on events, making it a lower-risk option compared to direct betting.

Making direct bets

Another way to make money is by placing direct bets based on the odds of specific events. For example:

• Choose an event: Select an event you want to bet on, such as the outcome of the presidential election.
• Analyze the odds: Consider the current odds and make your prediction.
• Place your bet: Bet an amount you are comfortable with, knowing that if your prediction is correct, you can earn a significant return.

Besides Polymarket, several other platforms offer decentralized prediction markets. These platforms work similarly, allowing you to provide liquidity or place direct bets on various events.

While these opportunities can be lucrative, they come with very high risks. If the odds don’t go in your favor, you can incur substantial losses. 

It’s crucial to trade cautiously and never invest more than you can afford to lose. Always do thorough research and consider seeking advice from financial experts before diving in.

United States lawmaker French Hill noted that Donald Trump will take a more crypto-friendly approach than the present administration. The run-up to the Presidential Election has seen crypto become an issue with lawmakers making huge statements ahead of the polls. Donald Trump has also moved closer to the sector making a pro-crypto case.

French Hill Backs Trump’s Pro Crypto Stance

Republican lawmaker, French Hill explained the type of crypto regulatory framework he feels Donald Trump might adopt in the country. In a recent CNBC interview, French Hill stated that the recently passed FIT21 bill is the type of regulatory framework the Trump administration will adopt in the sector. 

#FIT21 that passed the House with 71 Democratic votes is exactly the kind of regulatory framework for digital assets that former President Trump would support if he were re-elected.

Watch more on @SquawkCNBC🔽 pic.twitter.com/ceTmU4LApU

— French Hill (@RepFrenchHill) July 3, 2024

The FIT21 bill is tipped to protect investors and consumers in the market by stating clear rules and powers of different regulatory bodies in the sector. According to Hill, Trump will adopt it because it directs the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) on the specific regulatory framework needed in the market. 

“… for people who are innovative and starting a token crypto, a related firm, custody of those assets, how to make sure consumers are protected, so that framework I think is the right approach and that’s what I will recommend for the President that he endorses, is we haven’t passed it between now and the end of this Congress.” 

Furthermore, he tipped Trump to be a pro-growth and innovative President on financial matters. 

Crypto Becoming Mainstream

This election cycle saw the crypto industry taking a place in mainstream issues following wider adoption across demographics. From candidates moving toward enthusiasts to recent pro-legislation in Congress, crypto assets have become a rallying point for officials. The US regulatory landscape has been criticized for stifling growth due to frequent SEC lawsuits. This led to executives pushing for pro-crypto laws and raising funds for pro-industry candidates. 

Also Read: Federal Reserve Forecasts “AI Will Be Deflationary” To Boost Economy

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David is a finance news contributor with 4 years of experience in Blockchain Technology and Cryptocurrencies. He is interested in learning about emerging technologies and has an eye for breaking news. Staying updated with trends, David reported in several niches including regulation, partnerships, crypto assets, stocks, NFTs, etc. Away from the financial markets, David goes cycling and horse riding.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.