Over the last two weeks, I wanted to get a pulse of which way elections might go. I rarely watch TV, so I turned to the prediction markets Kalshi and Polymarket. My goal was to understand what the crowd thought might happen. I don’t have an account on either platform and used them as a pulse check of the wisdom of the crowds. I didn’t make any predictions on either platform.

To be honest, I thought some of the predictions were way off at first. For example, one Georgia race was neck and neck according to pollsters and the media, but both prediction markets had one candidate with a 70% chance of winning. The difference between the prediction markets and the pollsters was huge, and I assumed local pollsters might be more accurate. Nope. The candidate Kalshi and Polymarket assigned a 70% chance of winning easily won the race. The opponent wasn’t even close. This was the case for several races I checked on both platforms. The election results changed my views on these prediction markets. I now understand that aggregating predictions from many people brings together judgments informed by diverse perspectives. Said differently, the wisdom of the crowd was more accurate in many instances than what was reported in the media.

My takeaway so far is that these platforms aren’t perfect and have lots of downsides, specifically acting as a replacement for gambling. But there are upsides to them too. The ability to check the pulse of people on the ground who have diverse perspectives is extremely valuable.

Prediction market platforms, for all their controversies, are powerful tools that aggregate the wisdom of the crowd. That’s valuable to me because I can leverage collective intelligence to get a better idea of the probabilities of certain outcomes.