Short answer
A prediction market is a market where you buy Yes or No shares on a real event. A share pays $1 if its side turns out right and $0 if wrong, so its price, between 0 and 1, reads as the market's chance. Buying Yes at $0.40 means paying 40 cents for a share that pays $1 if right: a x2.5 multiplier. Polymarket, Kalshi and Hyperliquid's outcome markets (HIP-4) all work this way. Predictions are live in CopyHype.
Prediction markets went from a niche idea to one of the biggest stories in crypto and finance. People trade on elections, sports, Bitcoin's price and interest rates. Under the headlines, the mechanism is surprisingly simple. Once you understand one share, you understand them all.
A note before we start: predictions are live in CopyHype. This page teaches the topic itself. Part of our prediction markets guide.
What is a prediction market, in one sentence?
A prediction market is a place to buy and sell shares that pay $1 if an event happens and $0 if it does not. Because the payout is fixed, the price of a share works as a probability.
People search for them under many names: prediction markets, event contracts, outcomes, event trading, binary markets, "Polymarket-like" or "Kalshi-like" apps. They all describe the same basic share.
How does a Yes share work?
You pay the current price, and receive $1 per share if Yes turns out right. If Yes is wrong, the share is worth $0.
Example: "Will BTC be above $100,000 on Friday at 08:00 UTC?" Yes trades at $0.40.
| You buy | Cost | If Yes | If No |
|---|---|---|---|
| 25 Yes shares at $0.40 | $10.00 | 25 x $1 = $25.00 | $0 |
| Profit | +$15.00 | -$10.00 |
That is a x2.5 multiplier on your $10 if you are right, and a total loss if you are wrong. Fees are left out here; we add them below.
Why is the price a probability?
Because a share that pays $1 is worth, on average, its chance of paying. If people think Yes has a 40% chance, they will pay about 40 cents for it.
| Yes price | Market's chance | Multiplier if right (1 / price) |
|---|---|---|
| $0.10 | 10% | x10 |
| $0.25 | 25% | x4 |
| $0.40 | 40% | x2.5 |
| $0.50 | 50% | x2 |
| $0.80 | 80% | x1.25 |
| $0.95 | 95% | about x1.05 |
Yes and No add up to about $1. If Yes is $0.40, No is about $0.60. More on reading prices: prediction market odds explained.
Who sets the price?
Other traders, through an order book. Buyers post the prices they will pay, sellers post the prices they will accept, and trades happen where they meet.
Nobody "sets the odds" like a bookmaker. If you think the market's 40% is too low, you buy Yes, which pushes the price up. If someone thinks it is too high, they sell. The price moves as news arrives, which is why prediction markets are often watched as live forecasts.
Can I sell before the result?
Yes. You can sell your shares at the current price any time before the market closes. You do not have to wait for the event.
Example: you bought 25 Yes at $0.40 ($10). Bitcoin rallies on Wednesday and Yes rises to $0.70. Selling now gives about $17.50: a profit of $7.50 without waiting for Friday. If Yes falls to $0.20 instead, selling gives $5, a $5 loss rather than a possible $10 one.
How is the result decided?
Each market has written rules saying exactly what counts as Yes, when, and which source decides. After the event, the result is posted and shares pay $1 or $0.
Who posts the result differs by platform. On Hyperliquid's outcome markets, an authorized oracle posts it, and price markets use Hyperliquid's own mark price. Polymarket uses the UMA Optimistic Oracle. Kalshi settles under its own rules as a regulated exchange. Always read the rules: "above $100,000" at which minute, measured where.
Where can you trade prediction markets?
The three biggest models are Polymarket, Kalshi and Hyperliquid's HIP-4 outcome markets. They sell the same kind of share but differ on who runs them and who can use them.
| Item | Polymarket | Kalshi | Hyperliquid HIP-4 |
|---|---|---|---|
| What it is | Crypto prediction platform | US exchange regulated by the CFTC | Outcome markets on Hyperliquid's own chain |
| Settles in | USDC | US dollars | USDC |
| Who can use it | Depends on country | Depends on country | Depends on country |
Hyperliquid's outcome markets went live on mainnet on May 2, 2026. The detailed comparison, with sources and fees, is HIP-4 vs Polymarket vs Kalshi. Our Hyperliquid explainer is Hyperliquid prediction markets, explained simply.
What do prediction markets cost?
Each platform charges differently, and fees usually matter most around a 50% price. On a $10 trade the difference is cents, but it adds up.
At the time of our last check (October 18, 2026), Hyperliquid charged nothing to buy an outcome and about 0.07% when selling or at settlement. Polymarket charges takers a fee on some categories and never charges makers. Kalshi publishes a fee formula. Hyperliquid also requires at least $10 per order. Full breakdown: prediction market fees compared.
What kinds of questions do prediction markets list?
Sports, crypto prices, politics, economics, entertainment and more, depending on the platform. Each question has a deadline and written rules.
| Category | Example question |
|---|---|
| Crypto prices | Will BTC be above $100,000 on Friday at 08:00 UTC? |
| Sports | Will this team win Sunday's match? |
| Economics | Will the central bank cut rates at its next meeting? |
| Entertainment | Will this film win the award? |
Some questions have more than two answers, like "Who will win the league?". Those are groups of Yes or No shares, one per answer, where exactly one settles Yes. On Hyperliquid, such a group is called a question. Explainer: what are outcome tokens?.
Are prediction markets accurate?
Often well calibrated on liquid questions, much less so on thin ones. A price of 70% does not mean the event will happen; it means it should happen about 7 times out of 10 if the market is well calibrated. Thin markets with few traders can sit far from the true chance for a long time.
What are the risks?
You can lose the whole amount you put in, and markets can be thin, confusing or not allowed where you live.
- Total loss. A share on the wrong side settles at $0.
- Long shots lose most of the time. A x10 multiplier means a 10% chance, as judged by the market.
- Rules risk. A market can settle differently from what you expected if you did not read the rules.
- Liquidity. On small markets, buying or selling can move the price against you.
- Legal status. Prediction markets are regulated differently in each country, and some block them. See are prediction markets legal?.
Does CopyHype offer prediction markets?
Yes, predictions on Hyperliquid's outcome markets (HIP-4) are live in CopyHype. Pick Yes or No from $10, next to Hyperliquid perps, or copy the best prediction traders.
You can open @copyhypefamilybot now and practice perps and predictions with $1,000 of practice money, free for 24 hours.
Frequently asked questions
Are prediction markets gambling?
Some countries treat them as gambling, others as financial products, others not at all. Mechanically, you buy a share whose value depends on an event, and you can lose all of it.
What is the difference between a prediction market and a sportsbook?
A sportsbook sets odds and takes the other side of your bet. A prediction market is an exchange: other traders take the other side, and you can sell before the end.
What is an outcome on Hyperliquid?
Hyperliquid's name for a prediction market contract, created by its HIP-4 upgrade. Each outcome settles to 0 or 1 in USDC.
What is the minimum on Hyperliquid prediction markets?
Hyperliquid requires at least $10 per order. CopyHype's minimum is also $10 a bet.
Can I trade predictions on CopyHype today?
Yes. Predictions are live, next to perps.
Keep reading
- Hyperliquid prediction markets (HIP-4 outcomes), explained simplyHow Hyperliquid HIP-4 outcome markets work: Yes and No prices as chances, a worked $10 example, USDC settlement, fees and what is listed.
- Prediction market odds explained: price is probability, and the payout mathWhy a prediction market price is a probability, how to turn it into a payout, decimal and American odds, the overround and expected value.
- Event contracts vs binary options vs sports betting: what is the difference?Event contracts, binary options and sports bets all pay on a yes or no outcome. Who you trade against, who sets the price, fees and risks compared.