Sector Applications

An analysis of event contracts on the largest US exchanges shows that beyond sports and cryptocurrencies — which together account for roughly 86-87% of the market — prediction markets are generating growing interest across areas such as economics, climate and weather, and entertainment.²¹ These emerging applications span an increasingly diverse set of domains, several of which are discussed below.

Policy and Legal

In policymaking, prediction markets offer continuously updated assessments of policy and legal outcomes that reflect evolving expectations around legislative, regulatory, and judicial developments. Unlike traditional polling, which captures a static snapshot of public sentiment, these markets can rapidly integrate expectations regarding industry knowledge, lobbying intensity, and the political climate. This makes them particularly adept at forecasting legislative outcomes, such as the likelihood that the Digital Asset Market Clarity Act will pass by a specific 2026 deadline.

For policymakers, these indicators provide a dynamic gauge of feasibility, timing, and impact, helping to inform strategy and decision-making. For businesses and individuals, they offer forward-looking signals that can help anticipate regulatory or judicial outcomes, enabling more proactive planning around investment, compliance, and operational decisions. Policy-related contracts have yet to gain significant traction, but early examples — such as contracts on whether OPEC will hike production by its next meeting — illustrate the types of questions these markets can address.²²

Economics

Well-functioning prediction markets could similarly improve both forecast accuracy and responsiveness by providing a dynamic, continuously updated view of economic expectations — particularly for event-driven outcomes where conditions change rapidly. Conventional forecasts, such as those produced by central banks or surveys of professional economists, are often released at fixed intervals and may quickly become outdated as new developments emerge. By contrast, prediction markets adjust continuously to incorporate both formal data releases and less tangible signals, such as shifts in sentiment and policy expectations. In practice, this enables businesses, investors, and policymakers to respond more quickly to evolving economic conditions through timely market-implied assessments of developments such as inflation, trade policy, and interest rate movements.

Although economics-related contracts currently account for under 1% of listed markets on major platforms, examples such as contracts on the US trade deficit for 2026 and on whether Argentina will dollarize by mid-2026²³ illustrate the range of forward-looking questions these markets can address.

Climate and Weather

Prediction markets complement traditional weather forecasting by capturing localized risks and expectations that broader meteorological models may not fully reflect. Because participants trade based on firsthand observations, regional weather patterns, and evolving local conditions, these markets can generate more granular assessments of the likelihood and impact of weather-related events. This region-specific perspective is particularly valuable for climate modeling and risk planning, especially for businesses and communities with concentrated geographic exposure that generalized forecasts may not adequately address.²⁴

In addition, well-functioning prediction markets could serve as a hedging tool for businesses and individuals exposed to localized weather risks. Agricultural producers, for example, may hedge against region-specific drought conditions, while energy providers may manage exposure to abnormal temperature swings that affect electricity demand. In property insurance, event-based markets can complement existing coverage by offering rapid, parameter-based payouts tied to predefined weather conditions, such as wind speeds in a specific region following an impending storm. Climate and weather markets remain a niche but growing category across platforms, with contracts on topics such as peak temperatures in Los Angeles and precipitation levels in New York City reflecting the types of localized events being traded.²⁵^,²⁶^,²⁷

Entertainment

Prediction markets allow for probabilistic assessments of entertainment outcomes, such as awards, box-office performance and show success. Their appeal lies in producing crowd-driven insights into audience sentiment and industry trends that may help studios, streaming platforms, and marketers gauge demand, refine release strategies, or allocate promotional budgets more effectively. They could also serve as a complementary tool to existing metrics such as pre-sales data, social media engagement, and critic reviews by translating multiple signals into a single, regularly updated probability. This can be particularly valuable in the entertainment industry, where outcomes are highly uncertain and driven by rapidly evolving public sentiment.

For example, one well-known online prediction market that uses virtual currency to forecast movie box-office success has been shown to be a reliable predictor of box-office outcomes.²⁸ Several movie studios have also utilized data from this platform in their marketing decisions. Entertainment-related contracts represent a limited but notable segment of prediction market activity, with listings such as contracts on the top artist on Spotify in a given year illustrating the breadth of outcomes traded.²⁹^,³⁰

Science

In scientific contexts, prediction markets translate distributed expert judgment into probabilistic estimates of research outcomes, such as the reproducibility and credibility of scientific studies.³¹ In healthcare, they have been used to track and forecast infectious diseases, as demonstrated by a pilot study in Iowa, where researchers predicted seasonal influenza activity two to four weeks in advance using clinical data from healthcare workers.³² The study’s authors observed that infectious disease forecasting is particularly well suited to prediction markets because relevant knowledge is “subjective and asymmetrically distributed across multiple professions” and not easily captured through standard statistical methods. By synthesizing information from diverse participants into a single forecast, the authors noted, such markets may improve both responsiveness and accuracy.

Science remains an emerging category, but examples such as contracts on whether the WHO will declare Hantavirus a public health emergency of international concern³³ and contracts on FDA approval timelines for specific new drugs suggest growing interest in applying these markets to scientific and public health questions.

Business

In business settings, prediction markets aggregate decentralized organizational knowledge into market-based projections that support strategic decision-making. One example is the use of corporate prediction markets, where employees trade on internal outcomes such as product launches, sales targets, or project timelines. By incentivizing participation, these markets convert dispersed insights into projections that, in some cases, outperformed traditional internal forecasting methods. Published case studies from several major technology and industrial companies suggest that forecast accuracy can improve over time as participants gain familiarity with the platform and refine their trading strategies.³⁴

Business contracts remain a nascent segment, but listings such as contracts on when SpaceX will officially announce an IPO³⁵ and Amazon’s 2026 capital expenditures³⁶suggest that prediction markets are increasingly being used to express views on corporate financial outcomes.

Academia

In academia, prediction markets have the potential to support institutional planning by incentivizing participation and information sharing, capturing insights that are often difficult to obtain through traditional surveys or administrative processes. Faculty, researchers, and students can trade on the likelihood of academic outcomes (e.g., research milestones, grant approvals, or institutional decisions), thereby converting diverse perspectives into outcome projections. In practice, these markets can help academic institutions identify potential project delays, assess the likelihood of funding success, allocate resources more effectively, and gauge institutional sentiment on proposed policies or administrative decisions.

Academia-focused contracts are relatively uncommon to date, though contracts on the resolution of specific university disciplinary actions illustrate the range of events that can be priced.