Prediction Markets: How Web3 and Blockchain Find a Mass Use Case

Prediction markets have recently shown significant growth, becoming one of the few segments in Web3 where the product has a clear and demanded use case. They offer users the chance to bet on the likelihood of future events, turning news into numerical probabilities. However, despite their popularity, there are many nuances to consider when evaluating their effectiveness and prospects.

Key Players in the Market

The prediction market today is concentrated around a few key players. For instance, platforms like Kalshi and Polymarket hold a significant share of the overall trading volume. Pew Research data indicates that from September 2025 to April 2026, the total monthly volume of prediction markets grew from less than $5 billion to $24 billion.

Kalshi and Polymarket

Kalshi, a regulated American prediction market, reported a trading volume of about $22.9 billion in 2025. According to Sacra estimates, by May 2026, its annualized revenue is expected to exceed $1.5 billion. Polymarket, on the other hand, is a crypto-native platform with a cumulative trading volume exceeding $36 billion and an annualized revenue of around $258 million according to DefiLlama.

Other Participants

• Opinion and Limitless: Onchain platforms that hold a notable position in the DeFi segment.
• Azuro: A B2B infrastructure for betting and prediction products.
• Myriad, Overtime, Predict.fun, and Sport.fun: These are niche players focused on specific markets and types of forecasts.
• Trueo and other early products: They are still in the experimental and development stage.

Growth Factors of the Market

The growth of prediction markets is driven by several factors:

• Politics, elections, wars, cryptocurrency, sports, and macroeconomics offer an almost endless stream of events for betting.
• It's easier for people to make a "yes/no" choice than to delve into complex financial instruments.
• For traders, it's a chance for speculation, and for journalists and businesses, a market expectations indicator.
• The use of AI for forecasting and news analysis makes strategies more accessible.
• Regulated players like Kalshi make the segment more understandable for the mass user.
• For Web3, it's a clear use case: wallet, liquidity, oracles, smart contracts, settlement, outcome markets.

Challenges and Prospects

Despite their potential, prediction markets are not always more accurate than experts or statistical models. For example, research on infectious diseases showed that such markets performed worse than simple statistical benchmarks. However, an analysis of Polymarket data from 2022-2026, covering 2.4 million users and $67 billion in turnover, showed that the market effectively aggregates information, although profits are concentrated in the hands of the top 1% of users, who took about 76.5% of all trading profits.

For users, it's not a way to make easy money, while platforms earn from transaction fees. Kalshi charges a transaction fee, and Polymarket uses taker fees on some markets.

Conclusion

Prediction markets have the potential to become not just another form of crypto-gambling, but one of the first mainstream Web3 products where blockchain is genuinely useful: a transparent market of probabilities, global liquidity, and the ability to quickly monetize opinions about the future. However, they must maintain their role as a tool for collective forecasting rather than turning into a more convenient format for betting on sports and news.