Combining crypto tech with established prediction market processes is not a brand new idea. Still, it is gaining traction now, with platforms emerging in large numbers and more asset holders choosing to stake their portfolios on future events falling one way or another.
2023 is a big year for this scene, so what can we expect from crypto prediction markets over the coming 12 months?
The basics of crypto prediction markets
Despite uncertainty surrounding the longevity of crypto, there’s still a tremendous amount of interest in this arena, and it’s not just investors and traders in blockchain-based assets that are getting involved.
Prediction markets backed by cryptocurrencies, where pricing is based on the probability of a particular event happening further down the line as determined by participants in said markets, are in the spotlight.
Perhaps most significantly, they’re appealing because they give those with their finger on the pulse a means to make bearish predictions without fear of being accused of exhibiting FUD-like sensibilities.
The predictions covered by these markets can cover all sorts of events. Some platforms cater to making forecasts on the pricing of specific currencies in the crypto space. Others, like the sites found on Casinos Crypto, take things like sports betting into account and can even include things like politics, commodities, and much more besides.
The major players
It’s worth discussing some of the platforms in more detail since different examples offer varied interaction and user control levels.
For example, Gnosis is a widely harnessed solution that uses Ethereum’s protocol to give anyone the ability to create their apps for running crypto prediction markets, and in combination with Omen.eth it allows for unique betting experiences to be built with relatively little effort.
There are also more targeted platforms, such as PlotX, which focuses on predicting crypto prices and lets those in the know make guesses on fluctuations that might occur within as little as an hour or as long as a week.
Then there’s the likes of Polymarket, where almost any topic is up for debate, with the wisdom or the madness of crowds holding sway, even while individuals can earn a payout for making accurate projections.
The issues of volatility
Earlier, we mentioned that uncertainty hanging over the world of cryptocurrencies was both a concern and an opportunity for prediction markets, and that undoubtedly remains the case in 2023.
2022 has not been a good year for many of the top assets, with Bitcoin and Ethereum undergoing harsh corrections and many altcoins suffering even more severely.
Then with more recent scandals, such as the collapse of FTX, many are claiming that this signals the death knell for the blockchain movement.
That said, this kind of volatility always attracted early adopters to crypto in the first place. And you can’t have the highs without the lows, as is the case with any market.
Suppose the current state of affairs continues and worsens in 2023. In that case, crypto prediction markets should weather the storm because there are earning opportunities in pessimistic predictions, just as in optimistic ones when times are good.
The bottom line
If you’re looking to get into crypto prediction markets, there’s ample opportunity to do so now, especially if you’ve seen the assets you own shrink in value and don’t want to cash out just yet. It’s a form of betting, so it should only be used responsibly.