Event

#Definition

An Event is the real-world occurrence that a prediction market is designed to forecast. It's the fundamental unit around which markets are structured - the "thing that happens" that determines how markets resolve.

Events can range from political elections and economic indicators to sports outcomes and technological milestones.

#Event vs. Market vs. Contract

These terms are often confused:

Example hierarchy:

Event: "Federal Reserve December 2025 Meeting"
  ↓
Market: "Will the Fed raise rates in December 2025?"
  ↓
Outcomes:
  - YES (rates increase)
  - NO (rates stay same or decrease)

#Event Characteristics

#Well-Defined Events

Good events for prediction markets have:

1. Clear Resolution: Unambiguous when outcome is determined

   • ✅ "Winner of Super Bowl LIX"
   • ❌ "Best quarterback in 2025" (subjective)

2. Specific Timeline: Defined start and end

   • ✅ "Tesla stock price on Dec 31, 2025 at market close"
   • ❌ "Tesla reaches $500" (no deadline)

3. Verifiable Outcome: Observable by all participants

   • ✅ "Official electoral college vote count"
   • ❌ "Secret military operation success"

4. Public Interest: Enough people care to create liquidity

   • ✅ "Next president of France"
   • ❌ "Who wins my local rec league game"

#Event Types

Political Events

• Elections (presidential, congressional, local)
• Policy passage (bills, referendums)
• Appointments (cabinet members, judges)
• Geopolitical occurrences (treaties, conflicts)

Economic Events

• Interest rate decisions
• Inflation/employment data releases
• Corporate earnings
• Market indices reaching levels

Sports Events

• Championship winners
• Individual game outcomes
• Season records
• Award winners (MVP, Cy Young)

Entertainment Events

• Award shows (Oscars, Grammys, Emmys)
• Box office performance
• Streaming viewership numbers

Technology Events

• Product launches
• Platform metrics (user counts)
• Breakthrough announcements
• Regulatory decisions on tech companies

Weather & Natural Events

• Hurricane landfalls
• Temperature records
• Precipitation levels
• Natural disasters

#Event Granularity

Events can be broken down from broad to specific:

Broad Event: "2024 U.S. Elections"

↓
Mid-level: "2024 Presidential Election"
↓
Specific: "Trump vs. Biden in Pennsylvania"
↓
Granular: "Trump wins PA by >5 points"

More granular events generally have:

• Lower liquidity (fewer traders care)
• Higher information sensitivity (easier to gain edge)
• Clearer resolution (less ambiguity)

#Event Coverage Across Platforms

#Kalshi (CFTC-Regulated)

• Allowed: Economic indicators, elections, weather, entertainment
• Prohibited: Gaming/uncertain events per CFTC guidelines
• Focus: Events with clear, objective resolution sources

#Polymarket (Decentralized)

• Wide Range: Politics, crypto, culture, sports, entertainment
• Flexible: Can create markets on niche events
• Global: Not limited to U.S. events

#PredictIt (Research)

• Political Focus: U.S. elections and political events primarily
• Limited: Position and market limits per participant
• Research Purpose: Operated for academic study

#Event Lifecycle

1. Event Announcement/Definition
   ↓
2. Market Creation (trading opens)
   ↓
3. Event Occurs (real-world outcome)
   ↓
4. Market Closes (trading stops)
   ↓
5. Market Settles (payouts distributed)

Some events are ongoing (continuous markets):

• "Will Bitcoin reach $100k before 2026?" (resets upon occurrence)
• "Next country to join the EU" (open-ended until resolution)

#Multi-Market Events

Single events often spawn multiple related markets:

Event: "Super Bowl LIX"

Related Markets:

• Winner (Chiefs, Eagles, 49ers, etc.)
• Point spread (>7 points, 3-7 points, <3 points)
• Total score (over/under 50.5)
• MVP winner (Mahomes, Hurts, etc.)
• Halftime show performer
• Length of national anthem
• Gatorade color dumped on winning coach

#Event Risk

Traders face event risk - uncertainty specific to the event:

• Cancellation: Event doesn't occur (game postponed, election delayed)
• Ambiguity: Outcome unclear (disputed election, tie)
• Source failure: Resolution source unavailable
• Rule changes: Event conditions change after market opens
• External shocks: Unforeseen circumstances (COVID canceling sports)

#Event Selection Criteria

Platforms choose events based on:

1. Public Interest: Will people trade?
2. Verifiability: Can outcome be objectively determined?
3. Timing: Is timeline appropriate for market?
4. Legal/Ethical: Is market legally permissible and ethical?
5. Resolution Cost: Can outcome be determined at reasonable cost?

#Creating Your Own Events

Some platforms allow user-created events:

Manifold Markets: Anyone can create markets on any event (play money) Polymarket: Permissioned market creation (real money) Kalshi: No user-created markets (CFTC-regulated, curated events only)

When creating events:

• Define clear, unambiguous outcomes
• Specify objective resolution source
• Set appropriate close and resolution dates
• Provide context and background information
• Anticipate and address edge cases

#Event Information Sources

Traders research events using:

• News aggregators: Google News, Twitter, specialized sites
• Polls & surveys: FiveThirtyEight, RealClearPolitics (for elections)
• Economic calendars: Fed meetings, jobs reports, earnings dates
• Historical data: Past similar events and outcomes
• Expert analysis: Domain specialists, academics, analysts
• On-chain data: For crypto-related events

#The Role of Events in Information Aggregation

Prediction markets excel when events:

• Have distributed information (no single source has full picture)
• Attract diverse traders with different knowledge
• Offer clear incentives for truth-seeking
• Can be broken down into sub-components

Events where markets struggle:

• Inside information dominates (corporate M&A)
• Very low probability (tail risks)
• Manipulation is easy (low liquidity)
• Outcome is distant future (discount rates matter)