Timeline of prediction markets

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This is a timeline of prediction markets.

Prediction markets are a forecasting mechanism able to handle efficiently the dynamic aggregation of dispersed information among various agents. They can be thought of as betting markets structured to elicit and aggregate beliefs of future events.

Prediction markets are also sometimes known under the names: information markets, electronic markets, decision markets, virtual markets, election stock markets, idea futures, artificial markets, political stock markets, game market.

Figure 1 of Rhode, Paul; Strumpf, Koleman (2013).png[1]

Figure 8 of Tziralis, Georgios; Tatsiopoulos, Ilias (2007).png[2]

Big picture

Time period Development summary
Up to the 16th century The first written records of political betting date from 1503 (wagering on papal election).[3]
16th & 17th century In Italian city-states, betting is prevalent regarding the choice of government officials and on papal selection.[1][4]
18th to early 20th century There are various instances of political betting on the timing and winning party of Parliamentary elections in Britain, on the outcomes of local and national elections in Canada, and on Presidential and Congressional winners in the United States.[5]

Full timeline

Year Event type Event
1945 Publication The economist Friedrich Hayek publishes the essay "The Use of Knowledge in Society" arguing that information is decentralized within an economy and how that contributes to efficiency. The essay initiates a wider interest for information in economics.[6] (In 2011, "The Use of Knowledge in Society" was selected as one of the top 20 articles published in the American Economic Review during its first 100 years.[7])
1961 Legal The Federal Wire Act becomes effective in the US, outlawing using wired communication for betting or wagering, to prevent interstate gambling.[8]
1975 Fiction John Brunner publishes The Shockwave Rider, a science fiction story involving a prediction market named the Delphi pool.[9]
1988 Launch Iowa Political Stock Market, a non-profit prediction market platform for educational and research purposes, launches during the US presidential election.[10]
1990 Corporate At Project Xanadu, the first hypertext project, Robin Hanson uses the first known corporate prediction market.[11]
1999 Performance Hollywood Stock Exchange's NominOptions predicts 32 out of 38 Oscar Nominations for the 80th Annual Academy Awards.[12]
2000 Launch Ron Bernstein and Sean McNamara start Intrade.com, a prediction market service operating from the Republic of Ireland.[13]
2000 Launch NewsFutures, a play-money prediction market, is found by Émile Servan-Schreiber and Maurice Balick.[14]
2001 Research DARPA launches a call for proposal for the development of decision markets, later known as FutureMAP.[15]
2001 Launch Long Bets Foundation is found as a 501(c)(3) public education nonprofit foundation by The Long Now Foundation.[16]
2002 Performance Chen and Plott (2002) ran eight prediction markets within Hewlett-Packard to forecast important variables like quarterly printer sales. These results showed that the markets were more accurate than the company’s official forecasts.[17]
2002 Corporate Yahoo starts experimenting with prediction markets internally.[18]
2003 Discontinuation Two US senators call for the immediate end of FutureMAP.[19] DARPA's FutureMAP program terminates the next day.[20]
2004 Publication James Surowiecki publishes the book "The Wisdom of Crowds", championing the idea of prediction markets.[21]
2004 Launch HedgeStreet is found with the approval of the Commodity Futures Trading Commission (CFTC).[22]
2005 Research An article in Nature states how Eli Lilly and Company used prediction markets to help predict which development drugs might have the best chance of advancing through clinical trials, by using internal markets to forecast outcomes of drug research and development efforts.[23]
2005 Corporate Google announces that it has been using prediction markets internally.[24]
2006 Launch XFuture, a Chinese-language prediction market exchange, is launched collaboratively by the Center for Prediction Markets at Taiwan’s National Chengchi University and xPredict Ltd.[25]
2006 Legal The Unlawful Internet Gambling Enforcement Act comes into effect in the US, prohibiting "gambling businesses from knowingly accepting payments in connection with the participation of another person in a bet or wager that involves the use of the Internet and that is unlawful under any federal or state law."[26]
2006 Corporate Inkling, a company offering prediction markets tools for businesses, is found.[27]
2006 Corporate The Ford Motor Company starts using a prediction market internally.[28]
2007 Publication First issue of the Journal of Prediction Markets, with Leighton Vaughan Williams of the Nottingham Business School as editor.[29]
2007 Corporate Multiple companies form the Prediction Market Industry Association, with the goals of promoting awareness, education, and validation for prediction markets.[30]
2008 Publication A New York Times article discusses the use of prediction markets at InterContinental Hotels, Best Buy, Cisco Systems, GE Healthcare, General Mills, ArcelorMittal, Swisscom, and others. [31]
2008 Launch iPredict launches with the approval of the Securities Commission of New Zealand.[32]
2008 Launch Smarkets, a person-to-person betting exchange platform, launches.[33]
2008 Legal The CFTC solicits comments on the appropriate regulatory treatment of financial agreements offered by markets commonly referred to as event, prediction, or information markets.[34]
2008 Publication A joint statement by 22 lead economists and scientists is published in Science on the promise of prediction markets, demanding that the CFTC should "establish safe-harbor rules for selected small-stakes markets" and that "Congress should support the CFTC’s efforts to develop prediction markets".[35]
2009 Fiction Eliezer Yudkowsky publishes the science fiction story Three Worlds Collide featuring a civilization using prediction markets.[36]
2010 Corporate NewsFutures becomes Lumenogic, a company offering collective intelligence services to firms.[37]
2010 Research IARPA's Aggregative Contingent Estimation (ACE) program launches, seeking innovation in allocation of probabilistic jugments, conditional probabilities for contingent events, mathematical aggregation of judgments by many individuals, representation of aggregated probabilistic forecasts and their distributions.[38]
2011 Launch DAGGRE launches as part of IARPA's ACE program.[39]
2011 Legal The US Department of Justice releases a formal legal opinion on the scope of the Wire Act of 1961 concluding, "interstate transmissions of wire communications that do not relate to a 'sporting event or contest' fall outside the reach of the Wire Act."[40]
2012 Research A systematic review of 155 articles on prediction markets published between 1990 and 2006 predicting that research on prediction on prediction markets will significantly increase, that there is a need to standardize the terminogy of the field, and that a dissemiination of prediction markets mechanism could lead to an expansion of relevant research and applications.[41]
2012 Legal CFTC charges Intrade and TEN with violating the CFTC’s Off-Exchange Options Trading Ban and filing false forms.[42]
2012 Launch David Pennock, Principal Research Scientist at Yahoo! Research in New York City, announces PredictWiseQ, an implementation of combinatorial prediction market design.[43]
2013 Research A meta-analysis indicates that "Various studies highlight that prediction markets are a reliable forecasting tool, which can be easily applied in larger settings and are applicable for short-run and long-run predictions", that "prediction markets possess certain advantages like immediate feedback, transparency over all alternatives and the generation of fun during consensus building through game mechanics" over incentivizing experts directly, but that research is still at the beginning.[44]
2013 Legal CFTC charges “Prediction Market” Banc de Binary Ltd, an Israeli firm, with violating the CFTC’s off-exchange options trading Ban and operating as an unregistered Futures Commission Merchant.[45]
2013 Publication A blog post discusses using prediction markets to fund public goods.[46]
2013 Launch CrowdMed, a company aiming to identify illnesses that have gone without a diagnosis using prediction markets, is part of the Y Combinator winter 2013 class and launches its public beta at TEDMED 2013 in Washington, D.C.[47]
2013 Launch First commit on TruthCoin (later called Hivemind), a Bitcoin-based decentralized prediction market.[48]
2013 Performance The Good Judgment Project wins IARPA's ACE program.[49]
2013 Performance (Snowberg, Wolfers, Zitzewitz 2013) show that the track record of prediction markets out-perform both professional forecasters and polls in a variety of statistical tests.[50]
2014 Publication An article by Paul Sztorc of Truthcoin discusses applications of prediction markets outside of prediction, such as lie detection, whistleblowing, stabilizing crypto-assets, policy advice, etc.[51]
2014 Research A systematic review of 316 articles on prediction markets from 2007 to 2013 concluding that "the fundamentals of the concept have been sufficiently investigated in the academic research and thus the overall forecasting performance of Prediction Markets is currently at the center of interest."[2]
2014 Legal CFTC provides No-Action Relief for Victoria University of Wellington, New Zealand, to operate a not-for-profit market for event contracts and to offer event contracts to US persons.[52]
2014 Launch Microsoft launches Prediction Lab, a product blending non-representative polling and prediction games.[53]
2014 Discontinuation DAGGRE stops. Robin Hanson announces SciCast, a combinatorial prediction markets for aggregating expertise, as part of IARPA's ForeST program.[54]
2014 Launch Launch of Fairlay, a Bitcoin-based prediction market.[55]
2014 Launch Lumenogic (previously NewsFutures) launches Hypermind, a play-money prediction market, leveraging techniques built for the Good Judgment Project.[56]
2015 Research Publication of a paper on the use of prediction markets to estimate the reproducibility of scientific research, in the Proceedings of the National Academy of Sciences.[57]
2015 Launch Launch of Metaculus, a web community aiming at generating accurate predictions.[58]
2015 Publication SciCast releases its final report.[59]
2015 Discontinuation Suspension of SciCast after losing IARPA funding.[60]
2015 Launch Jack Peterson and Joey Krug register the Forecast Foundation OU in Estonia, the parent organization of the decentralized prediction market Augur based on Ethereum.[61]
2015 Launch Martin Köppelmann announces Gnosis, a decentralized prediction market based on Ethereum.[62]
2015 Corporate Publication of a paper on the use of internal prediction markets at Google, Ford, and a pseudonymous materials & energy conglomerate.[63]
2016 Discontinuation iPredict closes after Associate Justice Minister Simon Bridges refused to grant it an exemption from the Anti-Money Laundering and Countering Financing of Terrorism Act, declaring that it was a "legitimate money laundering risk" because of the lack of customer due diligence.[64]
2016 Discontinuation Microsoft silently phases out Prediction Lab.[65]
2017 Launch Founding and initial coin offering of STOX, an Ethereum-based prediction market.[66]
2017 Launch The Winton Group (British investment management firm) starts climatepredictionmarket.com, a prediction market for climate prediction.[67]
2018 Legal The Federal Court in District of Columbia orders Intrade and TEN to pay $3 million Civil Monetary Penalty for illegally trading binary options and violating a 2005 CFTC Cease and Desist Order.[68]
2018 Launch Official launch of Augur, a decentralized prediction market based on Ethereum.[69]
2018 Launch Launch of Frame Project, a real-money prediction market for popular culture events and news.[70]
2019 Publication The book Foundations of Prediction Markets: Modeling, Simulation, and Empirical Evidence is planned to be published in April 2019.[71]

Meta information on the timeline

The initial version of the timeline was written by Orpheus Lummis.

Funding information for this timeline is available.

Feedback and comments

Feedback for the timeline can be provided at the following places:

Timeline update strategy

Review yearly the advances of the field and historical material that is uncovered.

See also


  1. 1.0 1.1 Rhode, Paul; Strumpf, Koleman (2013-11-12). "The Long History of Political Betting Markets: An International Perspective". doi:10.1093/oxfordhb/9780199797912.001.0001/oxfordhb-9780199797912-e-029. 
  2. 2.0 2.1 Horn, Christian Franz; Ivens, Bjoern Sven; Ohneberg, Michael; Brem, Alexander (2014-09-23). "Prediction Markets – A literature review 2014". The Journal of Prediction Markets. 8 (2): 89–126. doi:10.5750/jpm.v8i2.889. 
  3. Baumgartner, Frederic J. (2003), "The Creation of the Conclave", Behind Locked Doors, Palgrave Macmillan US, pp. 39–58, ISBN 9781403969620, retrieved 2018-09-04 
  4. Walker, J. (1999-02-01). "GAMBLING AND VENETIAN NOBLEMEN c. 1500-1700". Past & Present. 162 (1): 28–69. ISSN 0031-2746. doi:10.1093/past/162.1.28. 
  5. Rhode, Paul; Strumpf, Koleman (2013-11-12). "The Long History of Political Betting Markets: An International Perspective". doi:10.1093/oxfordhb/9780199797912.001.0001/oxfordhb-9780199797912-e-029. 
  6. Hayek, Friedrich, "The use of knowledge in society", The economic nature of the firm, Cambridge University Press, pp. 63–68, ISBN 9780511817410, retrieved 2018-09-30 
  7. Arrow, Kenneth J; Bernheim, B. Douglas; Feldstein, Martin S; McFadden, Daniel L; Poterba, James M; Solow, Robert M (February 2011). "100 Years of theAmerican Economic Review: The Top 20 Articles". American Economic Review. 101 (1): 1–8. ISSN 0002-8282. doi:10.1257/aer.101.1.1. 
  8. "Text of the 1961 Federal Wire Act" (PDF). 
  9. Brunner, John (1975). The shockwave rider (Book club ed. ed.). New York: Harper & Row. 
  10. "Wall Street Journal reprint of "Iowa Market Takes Stock of Presidential Candidates"". Archived from the original on 2012-11-30. 
  11. "Robin Hanson's Bio". 2015-02-19. Retrieved 2018-09-04. 
  12. "Wayback Machine" (PDF). 2018-08-26. Retrieved 2018-09-04. 
  13. "Sport in the City". 2013-06-01. Retrieved 2018-09-04. 
  14. "NewsFutures.com : La Bourse de l'Info". 2000-12-16. Retrieved 2018-09-04. 
  15. "POINTS OF CONTACT". 2002-01-11. Retrieved 2018-09-04. 
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  17. Chen, Kay-Yut; Plott, Charles R. (2008), "Chapter 40 Markets and Information Aggregation Mechanisms", Handbook of Experimental Economics Results, Elsevier, pp. 344–352, ISBN 9780444826428, retrieved 2018-09-23 
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  27. "Inkling | Crunchbase". Crunchbase. Retrieved 2018-09-04. 
  28. Montgomery, Thomas A.; Stieg, Paul M.; Cavaretta, Michael J.; Moraal, Paul E. (2013-08-11). "Experience from hosting a corporate prediction market: benefits beyond the forecasts". ACM: 1384–1392. ISBN 9781450321747. doi:10.1145/2487575.2488212. 
  29. "Vol 1, No 1 (2007)". 2013-03-08. Retrieved 2018-09-04. 
  30. "PMIA – Come to Know". 2017-04-29. Retrieved 2018-09-04. 
  31. Lohr, Steve. "Betting to Improve the Odds". Retrieved 2018-09-23. 
  32. "Futures Contracts (iPredict Limited) Declaration and Exemption Notice 2008 (SR 2008/285) – New Zealand Legislation". 2011-04-07. Retrieved 2018-09-04. 
  33. "About « Smarkets Blog". 2008-04-02. Retrieved 2018-09-04. 
  34. "Concept Release on the Appropriate Regulatory Treatment of Event Contracts". Federal Register. 2008-05-07. Retrieved 2018-09-04. 
  35. Arrow, K. J.; Forsythe, R.; Gorham, M.; Hahn, R.; Hanson, R.; Ledyard, J. O.; Levmore, S.; Litan, R.; Milgrom, P. (2008-05-16). "ECONOMICS: The Promise of Prediction Markets". Science. 320 (5878): 877–878. ISSN 0036-8075. doi:10.1126/science.1157679. 
  36. Yudkowsky, Eliezer (2009). "Three Worlds Collide". LessWrong. 
  37. "Lumenogic: Collective Intelligence Solutions for Senior Leadership". 2010-07-03. Retrieved 2018-09-04. 
  38. "Aggregative Contingent Estimation (ACE) Program Broad Agency Announcement (BAA) - Federal Business Opportunities: Opportunities". 2012-09-16. Retrieved 2018-09-04. 
  39. "DAGGRE". 2012-01-27. Retrieved 2018-09-04. 
  40. "Wayback Machine" (PDF). 2014-08-15. Retrieved 2018-09-04. 
  41. Tziralis, Georgios; Tatsiopoulos, Ilias (2007). "Prediction markets: an information aggregation perspective to the forecasting problem". World Review of Entrepreneurship, Management and Sustainable Development. 3 (3/4): 251. ISSN 1746-0573. doi:10.1504/wremsd.2007.014044. 
  42. "CFTC Charges Ireland-based "Prediction Market" Proprietors Intrade and TEN with Violating the CFTC's Off-Exchange Options Trading Ban and Filing False Forms with the CFTC". 2012-12-02. Retrieved 2018-09-04. 
  43. "Raise your WiseQ to the 57th power » Oddhead Blog". 2012-10-20. Retrieved 2018-09-04. 
  44. "Accessing Knowledge with a Game -- A Meta-analysis of Prediction Markets - IEEE Conference Publication". ieeexplore.ieee.org. Retrieved 2018-09-30. 
  45. "CFTC Charges "Prediction Market" Proprietor Banc de Binary with Violating the CFTC's Off-Exchange Options Trading Ban and Operating as an Unregistered Futures Commission Merchant | U.S. COMMODITY FUTURES TRADING COMMISSION". www.cftc.gov. Retrieved 2018-09-23. 
  46. "Betting against public goods that you want". Ideophilus. 2013-10-20. Retrieved 2018-09-23. 
  47. "With $1.1 Million In Funding, YC-Backed CrowdMed Launches To Crowdsource Medical Diagnoses". TechCrunch. Retrieved 2018-09-23. 
  48. "First Commit · psztorc/Truthcoin@d54e621". GitHub. Retrieved 2018-09-04. 
  49. "Good judgment in forecasting international affairs (and an invitation for season 3)". 2013-11-27. Retrieved 2018-09-04. 
  50. Snowberg, Erik; Wolfers, Justin; Zitzewitz, Eric (2013), "Prediction Markets for Economic Forecasting", Handbook of Economic Forecasting, Elsevier, pp. 657–687, ISBN 9780444536839, retrieved 2018-09-23 
  51. Sztorc, Paul (2014). "Extra-Predictive Applications of Prediction Markets" (PDF). 
  52. "CFTC Staff Provides No-Action Relief for Victoria University of Wellington, New Zealand, to Operate a Not-For-Profit Market for Event Contracts and to Offer Event Contracts to U.S. Persons". 2014-11-03. Retrieved 2018-09-04. 
  53. "Why Microsoft Prediction Lab | PredictWise". 2015-09-19. Retrieved 2018-09-04. 
  54. "Overcoming Bias : Announcing: SciCast". 2014-05-03. Retrieved 2018-09-04. 
  55. "FAIRLAY.COM - New Bitcoin Prediction Market". 2014-04-09. Retrieved 2018-09-04. 
  56. "Wayback Machine" (PDF). 2018-08-31. Retrieved 2018-09-04. 
  57. Dreber, Anna; Pfeiffer, Thomas; Almenberg, Johan; Isaksson, Siri; Wilson, Brad; Chen, Yiling; Nosek, Brian A.; Johannesson, Magnus (2015-12-15). "Using prediction markets to estimate the reproducibility of scientific research". Proceedings of the National Academy of Sciences. 112 (50): 15343–15347. ISSN 0027-8424. PMC 4687569Freely accessible. PMID 26553988. doi:10.1073/pnas.1516179112. 
  58. "Metaculus". 2015-12-24. Retrieved 2018-09-04. 
  59. "SciCast Final Report (Public) | The Official SciCast Blog". 2016-01-24. Retrieved 2018-09-23. 
  60. "So Long, and Thanks for All the Fish! | The Official SciCast Blog". 2015-06-09. Retrieved 2018-09-04. 
  61. "Wayback Machine". 2018-08-30. Retrieved 2018-09-04. 
  62. "r/ethereum - Groupgnosis Prediction Market is Live; Trading has Begun.". reddit. Retrieved 2018-09-04. 
  63. Cowgill, Bo; Zitzewitz, Eric (2015-04-02). "Corporate Prediction Markets: Evidence from Google, Ford, and Firm X". The Review of Economic Studies. 82 (4): 1309–1341. ISSN 0034-6527. doi:10.1093/restud/rdv014. 
  64. "iPredict Message - iPredict". 2017-09-29. Retrieved 2018-09-04. 
  65. "Wayback Machine". web.archive.org. Retrieved 2018-09-04. 
  66. "STOX – The Prediction Platform's ICO Begins Now! - NEWSBTC". 2017-08-02. Retrieved 2018-09-04. 
  67. "Winton provides market for those who want to wager on the weather - Pensions & Investments". 2018-01-30. Retrieved 2018-09-04. 
  68. "Federal Court in District of Columbia Orders "Prediction Market" Companies to Pay $3 Million Civil Monetary Penalty for Illegally Trading Binary Options and Violating a 2005 CFTC Cease and Desist Order | U.S. COMMODITY FUTURES TRADING COMMISSION". 2018-08-01. Retrieved 2018-09-04. 
  69. "Augur Launches – Augur – Medium". 2018-07-10. Retrieved 2018-09-04. 
  70. "The Fame Project is Letting People Bet on the Future". TGDaily. Retrieved 2018-09-04. 
  71. Chen, Shu-Heng; Tung, Chen-Yuan; Yeh, Jason; Chie, Bin-Tzong; Tai, Chung-Ching; Lin, Hung-Wen (2019-04-13). Foundations of Prediction Markets: Modeling, Simulation, and Empirical Evidence (1st ed. 2019 edition ed.). Place of publication not identified: Springer. ISBN 9784431552291.