Glossary
Prediction market terms, defined.
The shortest possible plain-English explanations of the terms you'll see across every prediction market platform.
CFTC
The US Commodity Futures Trading Commission, which regulates derivatives including event contracts.
Designated Contract Market (DCM)
A US futures exchange registered with and regulated by the CFTC.
Event contract
A financial instrument that pays one dollar if a specified event occurs, and zero otherwise.
Implied probability
The probability that contract prices imply for an event happening, derived from the bid/ask.
Market maker
A participant who continuously quotes both buy and sell prices to provide liquidity.
Prediction market
An exchange where contracts pay out based on the outcome of a real-world event.
Settlement
The final cash payout of contracts after the underlying event has been resolved.