Betting markets contracted significantly on the eve of Tuesday’s presidential election, with Donald Trump’s lead over Kamala Harris narrowing as Americans cast their votes.
In recent weeks, the former president and his allies have touted their betting market predictions as more accurate than traditional polls, as he leads Harris by a wide margin on top platforms.
But as Election Day approached, Mr. Trump’s chances of victory diminished, with Ms. Harris even regaining the lead on one platform this weekend.
The popularity of betting markets skyrocketed during this election campaign, with prominent apps such as Polymarket and Kalshi mushrooming in app stores.
Many of the betting market’s predictions about who is most likely to win the election also diverged from popular opinion polls. Although polls showed an incredibly close race for the White House, betting platforms had a clear lead for Trump a few weeks ago.
But Trump’s chances as president are clearly declining. Polymarket put them at 58% as of Monday, down from 67% last week. Mr. Kalsi said the percentage had fallen from 65% to 53%.
Another platform predicted that Harris’ odds would beat Trump for the first time in almost a month. According to PredictIt, Democrats have a 53% chance of winning, while President Trump has a 51% chance of winning.
Bets in these markets are bids on political futures contracts. As with the prospect of a Harris or Trump presidency, purchasing a contract increases the price of that contract or the perceived likelihood of it happening.
For example, if you go to Polymarket on Monday and bet on Mr. Trump, if he wins the election you will receive $1 for every 58 cents you bet. On the same day, if you bet on Harris on the same platform, you would receive $1 for every 43 cents you wagered if she won.
This weekend, a shocking poll in Iowa unexpectedly showed Harris ahead of Trump, shocking American pollsters. Betting market experts say participants consider a variety of factors, including the results of these surveys, when making bets.
In recent weeks, questions have been raised over the activities of the gambling market. When it was revealed that a man had bet more than $30 million on Polymarket for Trump to win, both he and the platform stressed that this was not an attempt to manipulate the market.
The man, who gave his name as Teo, told the Wall Street Journal, “My purpose is just to make money,” and insisted he had “no political intentions.”
