Chart of 478M Polymarket trades shows prices are almost perfectly calibrated
NathanpmYoung · x · 2026-10-26
An X exchange over whether prediction markets have predictive value: one user claimed they don't, but the reposted chart — digitized from Reichenbach & Walther (2025), Exploring Decentralized Prediction Markets (SSRN 591052) — makes the opposite case.
- Each dot groups contracts at similar prices, priced halfway through each market's life, covering 478 million trades
- Polymarket price vs. actual event frequency falls almost exactly on the diagonal: 30%-priced events happen 30% of the time
- Takeaway: individual markets can be wrong, but the market's aggregate calibration is remarkably strong
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