Prediction markets saw significant growth in the third quarter of 2024, driven by bets on the upcoming United States presidential election, which could have wide-reaching effects on cryptocurrency regulations.

The betting volume on prediction markets rose over 565.4% in Q3 to reach $3.1 billion across the three largest markets, up from just $463.3 million in the second quarter of 2024.

The significant growth in prediction market volume was mainly attributed to increasing bets on the outcome of the US elections, according to an Oct. 14 CoinGecko report, which stated:

“Prediction markets picked up steam in 2024 Q3, growing 565.4% due to pundits betting on the upcoming US elections.”
Prediction markets rise 565% in Q3, fueled by US elections image 0

Top three crypto prediction markets. Source: CoinGecko

Decentralized prediction markets could be more accurate in predicting the results of the 2024 US election than traditional polling, according to billionaire Elon Musk.

Prediction markets like Polymarket enable users to stake stablecoins like USD Coin ( USDC ) on the outcome of a specific event.

Related: US election outcome won’t stop Bitcoin from hitting $100K: Dan Tapiero

Polymarket accounts for 99% of market share

Polymarket, the largest decentralized platform, dominated the market with over 99% market share as of September 2024.

Over 46% of Polymarket’s year-to-date (YTD) volume was driven by the US presidential elections poll, according to CoinGecko’s report, which added:

“Some $1.7 billion of bets have been placed on the “US Presidential Election Winner” since the start of 2024, accounting for ~46% of Polymarket’s yearly volume.”
Prediction markets rise 565% in Q3, fueled by US elections image 1

Polymarket TVL, year-to-date. Source: DefiLlama

Betting volume on Polymarket grew 713%, while transactions increased by 848% during the third quarter of 2024.

At the time of publication, Polymarket holds over $172 million in total value locked (TVL), according to DefiLlama data.

Related: WEF talks DeFi regulation, HKDA stablecoin integrates Chainlink: Finance Redefined

Former President Trump leads Harris on Polymarket

Former President Donald Trump is currently leading Vice President Kamala Harris by eight points on Polymarket.

According to Polymarket data, former President Trump has a 53.8% chance of winning the election, while only 45.3% of Polymarket users have bet on Harris.

Prediction markets rise 565% in Q3, fueled by US elections image 2

Presidential Election Winner 2024. Source: Polymarket

The odds flipped in Trump’s favor on Oct. 4, marking a sharp reversal from September. By Oct. 12, Trump was leading by over 10 points, Cointelegraph reported.

US Elections, Trump, and Macro: Impact on Crypto. Source: YouTube

Magazine: Harris’ unrealized gains tax could ‘tank markets’: Nansen’s Alex Svanevik, X Hall of Flame