Polymarket Bettors Show Uncanny Accuracy in Event Predictions
Prediction markets are gaining traction as a tool for forecasting real-world events, with Polymarket emerging as a standout performer. Using Brier scores—a statistical measure of prediction accuracy—analyst Alex McCullough found Polymarket's probabilities achieved a remarkably low score of 0.0581. For context, a market with uniformly 50% probabilities WOULD score 0.25.
The methodology penalizes overconfidence: Assigning 90% odds to a failed event yields a punitive 0.81 Brier score, while a conservative 10% misprediction scores just 0.01. This mirrors professional sports betting paradigms, where value is judged against closing lines rather than binary outcomes.
Daniel Kahneman's wisdom looms large: "The illusion that one has understood the past feeds the further illusion that one can predict and control the future." Yet Polymarket's track record suggests some crowdsourced forecasts may indeed pierce the fog of uncertainty.
