Can Prediction Markets Outsmart Scientists? Experts Doubt Crypto Betting Platforms

The meteoric rise of cryptocurrency-fueled prediction markets such as Polymarket and Kalshi has created a new frontier for wagering on scientific and geopolitical events, from disease outbreaks to climate milestones. These platforms, which allow users to buy and sell shares based on event outcomes, are touted by proponents as harnessing the "wisdom of crowds" to generate forecasts superior to expert analysis. However, the scientific community remains largely sceptical, viewing these markets as volatile indicators of public sentiment rather than reliable substitutes for rigorous research. The core mechanics of prediction markets rely on collective demand setting share prices, theoretically reflecting the aggregated knowledge of all participants. While studies have shown such markets can outperform polls in political forecasting, their application to complex scientific questions is fraught with challenges. "Prediction markets are potentially helpful forecasting supplements," says Richard Borghesi, a finance researcher at the University of South Florida. He cautions they are not "substitutes for models, peer review or expert judgement," particularly when traders lack specialist knowledge. Integrity concerns also loom large, with incidents like suspicious betting activity preceding the 2025 Nobel Peace Prize award raising alarms about potential manipulation. A recent case study involves a hantavirus outbreak reported on a cruise ship in early May. A Polymarket contract initially assigned a 19% probability to the World Health Organization declaring a hantavirus pandemic this year, only to crash to 5% within days as the initial alarm subsided. Epidemiologists note that while traders referenced WHO data, their bets were likely driven more by post-COVID anxiety than scientific modelling. "The chance of a global hantavirus outbreak is very, very low," states Vaithi Arumugaswami, an infectious-disease researcher at UCLA, echoing assessments from global health agencies that deem the public risk minimal. Despite the scepticism, some experts see limited value in these platforms as barometers of public perception, especially on issues where scientific consensus is strong. Climate scientist Zeke Hausfather notes that some climate-related prediction markets appear "reasonably in line with experts' estimates." Ultimately, while prediction markets may capture the public's pulse on scientific issues, researchers insist they cannot replicate the depth of expert analysis, peer-reviewed models, or comprehensive data surveillance that underpin genuine scientific forecasting.