Everything on Trump!

Speculative phenomenon pours oil on the US election campaign

Rapper Forgiato Blow puts his money on Trump.

(Bild: Getty Images/Kevin Dietsch)

So-called prediction markets are predicting a landslide victory for Donald Trump in the US election in November. Betting platforms such as Polymarket are mentioned in media reports as sources to be taken seriously. However, there are considerable doubts about their validity.

Traditional polls show that the race for the US presidency is close. Most institutes see a wafer-thin lead for the Democratic candidate Kamala Harris. The race is particularly close in so-called swing states, which will have a decisive influence on the outcome of the election.

But a popular method of following - and betting on - the race shows a completely different outcome. Polymarket, one of the leading foreign-based political betting exchanges, gave Trump a 61 percent chance of winning the election on Thursday. Several factors cast doubt on the reliability of these figures.

Who is betting money here?
The betting providers' forecasts are not a scientifically conducted poll. The principle is a completely different and simple one: the more money is bet on a candidate, the better his chances are considered to be.

The CTFC, an independent US supervisory authority, recently warned against collusion and misinformation in order to manipulate these betting markets. This is because it is usually not known who is placing money and betting here. The majority of users hide behind pseudonyms. Such actions could seriously compromise the integrity of the elections, especially at a time when public trust is already low, the CTFC ruled.

And: unlike polls, anyone can bet. Foreign players can also bet on the outcome of the election - and thus manipulate trends and public perception. 

Polls show a balanced picture:

Elon Musk took action
Twitter owner and Trump supporter Elon Musk promoted this peculiar form of political participation on October 7. Since then, the Republican candidate has outpaced his rival Harris on the betting exchanges. The betting volume on Polymarket alone has cracked the 2 billion mark. Individual users are pumping millions into the system for a Trump victory.

The pseudonym "Fredi9999" holds a position worth more than 15 million dollars. It is not known whether one or more people are behind the account. These crazy sums falsify the result and thus the advertised chances of winning. 

The renowned pollster Nate Silver has repeatedly noted the discrepancy between polls and betting providers and declared years ago that the betting markets "have gotten so stupid that they may be a contra-indicator at this point". Incidentally, the chance of Trump winning was 89% with some betting providers in 2020 - on election night. What happened then is probably well known.

"Polymarket turns what would otherwise be an internet shouting match into a market where whoever is right wins," Polymarket founder Shayne Coplan told Forbes in July.

Trump and his "bookies"
Political observers see this phenomenon as one of the reasons why many Americans now find it so difficult to accept political defeats at the ballot box. Voters see themselves confirmed in their echo chambers by high odds, even if they are wrong. Four years ago, Trump doubted the election result partly because he was ahead with the "bookies".