Gate connects to Polymarket prediction markets: a new type of crypto trading model centered on event probabilities

Cryptocurrency Trading Modes Are Becoming More Diverse

In the early stages of the crypto asset market, traders mainly rely on price fluctuations to make investment judgments. Technical indicators, trend analysis, and fundamental research are common bases for decision-making in the market.

As the market gradually matures, new trading methods begin to emerge. Among them, event-driven trading is gaining attention. This model no longer focuses purely on an asset’s price; instead, it centers on the outcomes of specific events, such as policy decisions, election results, or important economic data. In such markets, the core of trading becomes assessing the probability of an event occurring, rather than tracking the price movement of a single asset.

How Prediction Markets Form Event Probability

The basic concept of prediction markets is to convert participants’ views on future events into tradable prices. When a large number of buy and sell activities appear in the market, the price gradually forms a consensus level. This price is generally understood as the market’s overall assessment of the likelihood that an event will occur. For instance, when an event’s trading price is close to 70%, it means the market as a whole believes there is a relatively high chance of that event happening.

Because participants enter the market with different information and viewpoints, prices will change continuously as trading occurs. This allows prediction markets to have two functions at the same time:

1. Provide trading opportunities
2. Consolidate market information

Therefore, prediction markets are often seen as an information mechanism that aggregates collective opinions.

Viewpoint Differences Create Trading Space

Similar to other financial markets, price fluctuations in prediction markets usually come from different judgments among participants. Investors may form different expectations about the same event based on their respective research methods, sources of information, or analytical logic. When these expectations diverge, trading arises in the market.

Before the outcome of an event is confirmed, any new information may change market expectations, causing prices to fluctuate. For traders, these changes may create short-term or stage-based trading opportunities. Therefore, the real core of competition in prediction markets is actually the ability to access information and make judgments.

Different Trading Modes to Meet Various Needs

To allow more users to participate in event trading, some platforms provide different trading approaches in their product design.

1. Simple Prediction Mode In this mode, event probabilities are presented through an intuitive interface. Users can quickly understand market expectations and make selections, and the trading process is relatively simple.

2. Advanced Trading Mode For users who are familiar with trading systems, the platform provides more complete market tools, such as an order book, trading depth, and real-time execution data, making it easier to execute more precise strategy operations.

This dual-mode design helps both beginners and professional traders find trading methods that suit them.

Basic Process for Participating in a Prediction Market

Users only need to complete a few steps to start participating in event trading:

1. Update the App Update the Gate App to version v8.12.5 or above.

2. Log in to Your Account Log in to your Gate account and complete the necessary verification.

3. Enter the Market On the app homepage, check the tradable events in the Alpha section.

4. Choose a Trading Direction Choose Yes or No based on your judgment, and enter the trading amount.

5. Wait for Settlement After the event outcome is confirmed, the system automatically completes profit settlement.

Overall, the process combines information assessment with trading operations, making it relatively easy for users familiar with crypto trading platforms to get started.

Centralized and On-Chain Trading Run in Parallel

Some prediction market platforms adopt a dual-track operating model to accommodate different user preferences. Generally, users can trade stablecoins through the platform’s account system. The operation method is similar to that of traditional trading platforms, with a simple process.

On the other hand, users familiar with blockchain technology can also participate in on-chain trading through Web3 wallets. These transactions and settlements are typically completed on the Polygon network, allowing the system to retain a certain degree of decentralization. This design enables users with different technical backgrounds to participate in the market.

Real-Time Data Improves Market Transparency

To help users more easily understand market developments, platforms usually integrate multiple information tools, including:

• Market price changes
• Event probability fluctuations
• Order book depth
• Real-time execution data

These data can help traders gain a more comprehensive understanding of market conditions.

At the same time, the process from position building to final settlement has also been highly automated. Once the event outcome is determined, the system directly completes settlement and allocates profits, making the overall operation smoother.

Potential Future Directions for Prediction Markets

As the number of participants increases, the influence of prediction markets may gradually grow. The prices formed by large volumes of trading activity can also reflect the market’s judgment of future events in real time. This mechanism not only serves a trading function, but could also become an important information indicator.

In the future, prediction markets may further integrate with the following areas:

• Data analysis
• Financial markets
• Blockchain technology

As technology and the market environment continue to mature, event probability pricing may become a new source of market information.

Summary

Prediction markets bring a new form to crypto trading. Unlike traditional trading centered on price fluctuations, event trading focuses on probabilistic judgments of future outcomes. Through intuitive interfaces, multiple participation methods, and an architecture that runs on-chain and centralized systems in parallel, prediction markets are lowering the barrier to use, enabling more users to participate. With market scale expanding and technology continuing to advance, this trading model is expected to play a more important role in the crypto ecosystem and provide new information and trading opportunities.