Onchain Prediction Markets
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In Brief
Onchain prediction markets are crypto-native event-trading platforms where market creation, trading, and resolution all happen via smart contracts, removing the need for a centralized operator and letting users trade from a self-custody wallet.
What Are Onchain Prediction Markets?
Onchain prediction markets are decentralized platforms where every step of trading on real-world event outcomes — market creation, order matching, settlement, and resolution — is
executed by smart contracts rather than by a centralized operator. Users connect a self-custody wallet, deposit a stablecoin or other collateral, and trade "Yes" / "No" shares directly
on a public blockchain.
Unlike traditional event-contract exchanges or sportsbooks, onchain prediction markets are publicly auditable, non-custodial, and permissionless to access from a wallet.
Major examples include Polymarket on Polygon, Predict.fun on BNB Chain, and Hyperliquid's HIP-4 prediction markets.
How Do Onchain Prediction Markets Work?
A market is created onchain around a defined event with a clear resolution criterion.
The smart contract mints complementary "Yes" and "No" outcome tokens that together pay $1.
Traders buy and sell these tokens through an onchain order book or AMM.
A resolution source — typically a decentralized oracle — posts the outcome at the resolution date.
Winning tokens redeem 1:1 for the underlying collateral; losing tokens go to zero.
Users withdraw their balance back to their self-custody wallet at any time.
Key Features of Onchain Prediction Markets
Self-Custody
Funds stay in the user's wallet until the moment of trade execution.
Transparent Resolution
Outcomes are posted by oracles and verifiable onchain — no private operator decision.
Permissionless Access
Anyone with a wallet and a stablecoin can trade. No account creation required.
Onchain Liquidity
Order books and liquidity pools are public; positions and prices are visible to all participants.
Composability
Outcome tokens are ERC-20 (or equivalent) and can be used as building blocks in other DeFi protocols.
Onchain vs Off-Chain Prediction Markets
| Feature | Onchain (Polymarket, Predict.fun, HIP-4) | Off-Chain (Kalshi, sportsbooks) |
|---|---|---|
| Custody | Self-custody | Operator custody |
| KYC | None at the wallet | Typically required |
| Resolution | Oracle, onchain | Operator decision |
| Auditability | Fully public | Opaque |
| Trading hours | 24/7 | Operator-defined |
| Composability | Yes — DeFi-integrable | No |
Use Cases
Trading event outcomes without a centralized account
Building forecasting products on top of public market data
Hedging real-world risk in a verifiable, settled-onchain way
Yield strategies — earning on idle stablecoin collateral while positions are open (e.g., Predict.fun via Venus on BNB Chain)
Availability
Access to onchain prediction markets varies by platform and jurisdiction. Some venues restrict users in the United States, United Kingdom, and certain other regions.
Onchain Prediction Markets and Trust Wallet
Trust Wallet offers native in-app access to leading onchain prediction-market platforms — Polymarket, Predict.fun, and Hyperliquid (HIP-4) — letting users trade directly from a
self-custody wallet without bridging or creating exchange accounts. Availability of individual platforms varies by region.