Announcer Markets

#Definition

An announcer market is a prediction market that resolves based on what is officially announced or stated, rather than on the underlying factual outcome. The market tracks the announcement itself as the event.

This distinction matters because announcements and reality can diverge. A company might announce a product launch date that later slips. A government agency might release preliminary data that gets revised. An announcer market settles on the initial announcement, not subsequent corrections or the ultimate truth.

#Why It Matters in Prediction Markets

Announcer markets solve a fundamental problem in market design: defining an objective, verifiable resolution source. By tying outcomes to specific announcements from designated authorities, these markets eliminate ambiguity about what counts as "true."

For traders, this creates both opportunities and risks:

• Clarity: Resolution criteria are unambiguous: either the announcement happened or it didn't
• Speed: Markets can resolve immediately upon announcement rather than waiting for implementation or verification
• Divergence risk: The announcement may not reflect reality, creating edge cases where traders who are "right" about the world lose money

Announcer markets are particularly common for economic data releases, corporate earnings, policy decisions, and election calls where official sources provide definitive statements.

#Historical Context

Note: The "Announcer" terminology was primarily used in Augur v2 and early decentralized prediction market experiments. Modern platforms have largely adopted "Oracle" or "Resolution Source" terminology, but the concept remains relevant.

Announcer markets evolved from the practical need for verifiable resolution:

• 1988: The Iowa Electronic Markets established the pattern of resolving on official election results from designated sources, creating the template for announcer markets.
• 2000s: Intrade popularized markets on economic data releases (BLS unemployment, Fed rate decisions), where the announcement, not the underlying reality, determined outcomes.
• 2010-2020: As prediction markets grew, the distinction between "announcer" and "outcome" markets became explicit. Regulatory discussions highlighted the importance of clear, verifiable resolution sources.
• 2021-present: Kalshi and Polymarket formalized announcer market structures, with explicit language distinguishing announced values from underlying reality.

The announcer market concept emerged from a fundamental insight: markets need objective resolution, and announcements from trusted sources provide exactly that.

#Market Type Comparison

Announcer Market Resolution Sources:

#Oracle vs. Announcer

#How It Works

#Market Structure

Announcer markets typically follow this pattern:

1. Market creation: The platform specifies exactly which source counts as "official" (e.g., Federal Reserve press release, Associated Press election call, company earnings report)
2. Trading period: Participants buy and sell shares based on their predictions of what will be announced
3. Announcement event: The designated source makes its official statement
4. Resolution: The market settles based solely on what was announced, regardless of whether the announcement later proves accurate

#Resolution Logic

The key principle: the announcement is the outcome.

Consider a market asking "Will the Bureau of Labor Statistics announce unemployment below 4% for June?"

• If BLS announces 3.9% → Market resolves YES
• If BLS announces 4.1% → Market resolves NO
• If BLS later revises the figure to 3.8% → Resolution unchanged (already settled on initial announcement)

#Announcer Resolution Logic

#Numerical Example

A trader believes there's an 80% chance the Fed will announce a rate hold at its next meeting. The "Fed announces rate hold" contract trades at $0.70.

Expected Value = (0.80 × $1.00) + (0.20 × $0.00) - $0.70 = $0.10

The trader has positive expected value of $0.10 per share. If correct about the announcement probability, buying at$0.70 is profitable regardless of whether the Fed actually implements the announced policy.

/**
 * Verifies a cryptographic signature from a known announcer.
 * (Conceptual example using ethers.js)
 * 
 * @param message - The announcement text
 * @param signature - The cryptographic signature
 * @param announcerAddress - The expected public address of the announcer
 * @returns True if signature is valid and matches announcer
 */
function verifyAnnouncerSignature(message, signature, announcerAddress) {
  // Recover the address that signed the message
  const recoveredAddress = ethers.utils.verifyMessage(message, signature);
  
  // Check if it matches the known announcer
  return recoveredAddress === announcerAddress;
}

#Examples

#Economic Data Announcements

A binary market asks: "Will the initial CPI report show inflation above 3% for the measurement period?"

• Resolves on the Bureau of Labor Statistics first release
• Later revisions don't affect resolution
• Traders focus on predicting what BLS will report, not the "true" inflation rate

#Corporate Earnings

A market asks: "Will Company X announce quarterly revenue exceeding $10 billion?"

• Resolves on the official earnings release
• Subsequent restatements or audit adjustments are irrelevant
• Creates opportunity for traders who understand accounting presentation choices

#Election Calls

A market asks: "Will the Associated Press call the election for Candidate A before midnight?"

• Resolves on AP's editorial decision to call the race
• Actual vote counts or certification don't matter for resolution
• The "announcement" is AP's journalistic judgment, not the official result

#Policy Announcements

A market asks: "Will the central bank announce a new quantitative easing program at its next meeting?"

• Resolves on the official statement language
• Implementation details or later program modifications are separate questions
• Traders predict communication strategy, not just policy substance

#Risks, Pitfalls, and Misunderstandings

Confusing announcement with implementation

The most common mistake is assuming an announcer market tracks whether something actually happens. A "Will Company X announce a stock split?" market resolves on the announcement; if the split is later canceled, the market still resolved YES.

Source ambiguity

Not all markets clearly specify which source counts as "official." Does a CEO's interview comment count as an announcement? What about a leaked memo? Always verify the exact resolution source before trading.

Timing edge cases

Announcements can be ambiguous about timing. "Will they announce by Friday?" requires precision about time zones, business hours, and what constitutes an announcement versus a teaser or preview.

Revision risk awareness

Traders sometimes price announcer markets as if they were tracking ultimate truth. Economic data frequently gets revised, and initial announcements can be systematically biased. This creates opportunities for traders who understand the difference.

Announcement manipulation

In some cases, the party making the announcement knows about the market. While rare, this creates theoretical manipulation risk where announcers might strategically time or word statements.

Real-World Divergence Example: In 2024, a market on "Will the SEC approve Bitcoin ETFs by Jan 10?" faced chaos when the SEC's official X (Twitter) account was compromised and posted a fake approval.

• Announcer Market Logic: Did the official source announce it? Technically yes (the account posted it).
• Reality Logic: Did they actually approve it? No, it was a hack.
• Resolution: Most markets had to pause or rely on "clarification" clauses. This highlights the extreme risk of relying solely on a social media feed as an announcer source.

#Practical Tips for Traders

• Read the resolution source specification carefully before trading; know exactly which announcement from which source triggers resolution

• Track the announcer's patterns: Official sources often have predictable behaviors, release schedules, and communication styles that inform probability estimates

• Distinguish announcement probability from outcome probability: These can diverge significantly, especially for preliminary data releases

• Consider information asymmetry: Some traders may have faster access to announcements through professional terminals, proximity to press conferences, or social media monitoring

• Factor in announcement timing: Markets may offer better prices hours before an announcement when uncertainty is higher, versus minutes before when information may be leaking

• Use announcer markets for hedging: If your business depends on how markets react to announcements, these markets can hedge announcement risk specifically

• Watch for "stale" markets: Some announcer markets remain open after unofficial information suggests the outcome, creating arbitrage-like opportunities for fast traders

#Related Terms

• Prediction Market
• Binary Market
• Resolution Source
• Resolution Criteria
• Mention Market
• Tweet Market
• Event Contract

#FAQ

#How does an announcer market differ from a regular prediction market?

A regular prediction market might resolve on whether something actually occurred (e.g., "Did GDP grow above 2%?"), while an announcer market resolves specifically on what was announced (e.g., "Did BEA announce GDP growth above 2%?"). The distinction matters when announcements and reality diverge, such as when preliminary data gets revised or when announced plans change.

#What happens if the designated source never makes an announcement?

Most announcer markets include fallback provisions. Typically, if no announcement occurs by a specified deadline, the market resolves NO (the announcement didn't happen) or may be voided entirely. Always check the resolution rules for how the platform handles missing announcements.

#Are announcer markets more accurate than other prediction markets?

Announcer markets aren't necessarily more or less accurate about the real world; they're accurate about a different question. They excel at predicting what will be said, which may or may not correlate with underlying reality. For events where announcements closely track truth (like sports scores), the distinction is minimal. For events with significant announcement-reality gaps (like economic data), the markets measure different things.

#Can announcers manipulate these markets?

Theoretically, yes; if an announcer knows about the market and has financial interest in the outcome, they could strategically craft announcements. In practice, this risk is low for markets tied to institutional sources (government agencies, major news organizations) with reputational stakes in accuracy and independence. The risk is higher for markets tied to individual statements or less established sources.

#Why would someone trade an announcer market instead of waiting for the announcement?

Traders use announcer markets to express views on announcement probability, hedge exposure to announcement outcomes, or profit from superior information about what will be announced. For time-sensitive decisions that depend on announcements (investment allocations, business planning), these markets provide price discovery before the information becomes public.