Prediction markets signal Biden winning the popular vote but losing the presidency to Trump, potentially repeating the 2016 election scenario.
Donald Trump is one of only five U.S. presidents who won the Electoral College, and thus the nation's highest office, despite losing the popular vote. If prediction markets are correct, he will repeat that feat this year.
Popular Vote Market: On Polymarket's contract asking who will win the popular vote, "yes" shares for President Joe Biden are trading at 56 cents, indicating the market sees a 56% chance of the incumbent prevailing. Each share pays out $1 (in the USDC stablecoin) if the prediction comes true, and zero if it does not.
Trump's Popular Vote Odds: Trump, meanwhile, has only a 36% chance of winning the popular vote, according to recent prices. Traders have bet $36 million on this question, making it Polymarket's fourth-largest market by volume.
Presidency Market: The largest market by far is the one on who will win the presidency, with a record $182 million of bets placed. Here, Trump is the clear favorite, with a 57% chance of winning versus 35% for Biden.\
Under a regulatory settlement, Polymarket blocks U.S. users, so its traders are presumably making predictions from afar. PredictIt, a more traditional U.S. election betting site that settles bets in dollars with a quasi-regulatory blessing, gives Trump a 52% chance of winning the presidency and Biden 47%. The volume there is comparatively small, though, at $15.7 million.
Electoral College System
The Electoral College was conceived at the Constitutional Convention of 1787. It is designed to balance the influence of populous and less populous states, ensure smaller states have a voice in the election, and prevent a few large states from dominating the outcome. The popular vote, which carries no electoral weight, is simply the proportion of votes cast for each candidate.
The college consists of 538 electors. A majority of 270 electors' votes is required to win the presidency. Each state has the same number of electors as it does members in its Congressional delegation: one for each member of the House of Representatives (the number of House members is proportional to a state's population) plus two Senators.
Critics of this time-honored system call it undemocratic, while its defenders argue that it is a bulwark protecting the rights of the minority against the potential tyranny of the majority. This much seems certain: If the Polymarket bettors are right and Trump does win the Electoral College while losing the popular vote, "Not My President" rallies will be back in vogue.
Donation Negation
Crypto Donations:
Biden's Campaign: Despite reports, Biden’s campaign hasn’t accepted cryptocurrency donations, disappointing Polymarket traders who bet on it.
Market Dynamics: The "Biden accepts crypto donations by Friday?" contract launched on June 12 had a 9-day timeframe. Odds were initially 48%, but the market resolved to "no" on June 21 as no announcement was made.
Risk in Prediction Markets: Bets can be directionally correct but lost if they don't come true within the agreed timeframe.
Barron Drama
DJT Token:
Barron Trump's Involvement: A Polymarket contract questioned if Barron Trump was part of the team behind the Solana-based DJT token.
Market Resolution: The contract resolved to "no" twice and is under final review. Traders dispute the decision, citing Martin "Pharma Bro" Shkreli’s claim of Barron's involvement.
Token Performance: The token saw significant price fluctuations, peaking at 3 cents and dropping to 1 cent amid speculation and lack of confirmation from the Trump family.
Polymarket Activity: Traders give a 19% chance of Barron’s involvement, down from a 60% peak. The market has $693,000 in volume, Polymarket’s second-largest on a crypto-related question.
Source: Coindesk
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