What is a prediction market?
A prediction market is an exchange where people trade contracts on future events. A contract pays $1 if the event happens, $0 if it doesn't. The price it trades at — say, 65¢ — is the crowd's live estimate of the probability. Soccer markets list one contract per outcome: home win, draw, away win.
Kalshi vs Polymarket
Kalshi is a US prediction exchange regulated by the CFTC. You deposit US dollars, buy contracts that settle in cash. Liquidity is highest on US-coverage events (MLS, World Cup, EPL highlights).
Polymarket is a global crypto-based prediction market. Contracts settle in USDC. Coverage is broader — every major European league lists per-match markets — but the user base skews international.
Why they beat bookmaker odds
Bookmakers build a margin (the "vig") into every line. A 50/50 game at a bookmaker might show 1.91/1.91 — that's a ~4.5% overround. Prediction markets match buyers and sellers directly, so the cent prices on home + draw + away sum to ~100, not 105. The implied probability is cleaner. That's why analysts use prediction-market prices as ground truth and grade bookmaker lines against them.
Are they legal?
Kalshi operates as a CFTC-regulated US exchange. Polymarket restricts US-based users from trading directly. Both are designed as financial markets, not bookmakers — check your local rules before depositing.