From Hayek to Polymarket to TurboFlow: The Century-Long Evolution of Prediction Markets into Event Contracts

How does society know what it knows?

From guessing weights at a market stall, to political prediction markets, and then to short-term Event Contracts that anyone can join on-chain at any time, event contracts have undergone more than a century of evolution. At their core, they have never changed: turn different human views of the future into prices, then settle according to the outcome. What has changed is the range of events the market covers, the participation threshold, the trading cycle, and the underlying infrastructure.

Looking back along that path, Polymarket has turned prediction markets into a global Internet product, while TurboFlow has pushed event contracts further into the on-chain trading context for mainstream users. The two stand at different stages and product forms, but both are driving “trading the future” from an economics experiment into a mass-market product.

1. 1907—1945: From “crowd wisdom” to price discovery

event contracts can be traced back to 1907. British statistician Francis Galton observed that when a group of people at a market stall independently estimated the weight of an ox, the collective estimate was very close to the actual result. This story was later generalized into “crowd wisdom”: when participants hold different pieces of information, and their judgments can be formed relatively independently, the aggregate result is often closer to the truth than any individual.

Later, economists began asking a deeper question: if market prices can aggregate supply-and-demand information for goods, can they also aggregate judgments about future events?

In 1945, Friedrich Hayek in The Use of Knowledge in Society systematically explained the information function of the price mechanism. Knowledge in the real world is dispersed among countless individuals, while market prices can compress those fragmented judgments and information into a constantly changing signal. On that logic, markets can not only price goods, but also aggregate participants’ views on future events through trading.

event contracts are precisely the application of this logic to future outcomes. Suppose a contract reading “this event will happen” is currently priced at 0.62 USD, and is designed to pay 1 USD if the event occurs, and 0 if it does not. Then 0.62 USD can usually be understood as the market’s probability signal for that outcome. Participants commit capital based on their own judgment, while new information is continuously incorporated into the price through trading.

However, price is still affected by liquidity, participant composition, market sentiment, and trading rules, so it is better viewed as a real-time market judgment rather than an absolute probability. This has remained unchanged throughout the later development of event contracts.

2. 1988: Iowa Electronic Markets turns theory into an experiment

A key starting point for modern prediction markets appeared in 1988. Researchers at the University of Iowa created the Iowa Political Stock Market, later developed into Iowa Electronic Markets (IEM), and used contracts tied to U.S. presidential election outcomes to test whether markets could improve forecasting quality.

The market was initially very small in scale, and the amount of money participants could commit was strictly limited. But it proved one important thing: even with a limited number of participants, as long as they are willing to trade on new information, prices can still form a collectively generated judgment of reference value.

In 1992, IEM received a “no-action letter” from the U.S. Commodity Futures Trading Commission (CFTC), allowing the market to continue operating under small-scale, research-oriented conditions. From then on, event contracts gained, for the first time, a relatively stable institutional space. For many years, IEM prices were often compared with public opinion polls, and prediction markets were also pushed into the mainstream of economics research.

3. 1999—2013: Intrade proves commercial value while exposing regulatory limits

After academic experiments, commercial platforms began to appear. TradeSports and Intrade expanded tradable events into elections, economics, entertainment, and international affairs, opening up to a broader user base.

The value of Intrade drew attention in many U.S. elections. Media, researchers, and the public began to view market prices as another signal alongside opinion polls. More capital and more participants brought a more active price-discovery process, and prediction markets moved closer than ever to a mass Internet product.

Legal issues quickly intensified. In 2012, CFTC accused Intrade of providing unregistered commodity options trading to U.S. users. The platform then ceased service and shut down in 2013. The lesson from Intrade was clear: event contracts have real demand, but long-term development requires compliance, clearing, and market infrastructure commensurate with trading scale.

In the same period, event contracts also touched the boundaries of ethics and the public interest. In 2003, the Policy Analysis Market project funded by the U.S. Defense Advanced Research Projects Agency sought to use markets to forecast political and security developments in the Middle East. The project was quickly shut down amid public controversy. That event reminded the industry that whether a contract can be traded depends not only on contract design, but also on the public interest and the degree of social acceptance.

4. 2014—2020: Restricted markets continued to exist, while crypto infrastructure began to mature

After Intrade shut down, IEM along with restricted markets such as PredictIt continued to offer political event trading. They kept the research and product spark of prediction markets alive, but user scale, trade size, and the number of markets remained limited.

At the same time, stablecoins, smart contracts, on-chain wallets and automated market making gradually matured. event contracts began to have a new technical foundation: global users could trade on a unified network, rules and settlement procedures could be written into smart contracts, and markets could operate 24/7.

This created the foundation for a new growth spurt. Prediction markets began to shift from “a website run by a single organization” to on-chain markets that could be composable and verifiable.

5. 2020—2025: Polymarket brings prediction markets to the world

Polymarket launched in 2020, using stablecoins and blockchain infrastructure to provide event markets around politics, macroeconomics, technology, sports and culture. Users trade “yes” or “no” shares, prices change with supply and demand, and settlement occurs after the event result is determined.

The first change it brought was distribution. Prediction markets shifted from a regionally oriented product to a global Internet product, and market prices also began to be cited in real time by media, researchers and social platforms. During the 2024 U.S. election, Polymarket received unprecedented public attention, and event contracts became a high-frequency data source in global news discussions for the first time.

Polymarket's growth also came with compliance adjustments. In 2022, CFTC settled with the platform over the offering of unregistered on-chain event contracts, and required the handling of non-compliant markets. Afterwards, Polymarket continued to push forward its path into regulated markets.

In 2025, Intercontinental Exchange (ICE)——the parent company of the New York Stock Exchange——announced an investment of up to 2 billion USD in Polymarket, while planning to distribute data driven by the platform's events. This partnership carried symbolic meaning: event-derived probabilities formed from market trading began to be seen by traditional financial infrastructure as a data product that could serve institutional clients.

Polymarket completed an important shift in the history of event contracts——from academic research, niche communities and gray areas, into the mainstream view of global finance and media.

6. Kalshi and the expansion of the regulated U.S. market

Alongside the on-chain path, Kalshi chose to start from a regulated exchange. In 2020, the platform became a designated contract market registered with the CFTC, and launched event contracts around economic data, weather, politics and sports.

In 2024, a U.S. federal district court rejected the CFTC's ban on Kalshi's election contracts. In May 2025, the CFTC withdrew its appeal, and the case concluded. This accelerated the expansion of the event contracts market in the U.S., while also sparking new legal discussions at the federal and state levels.

By 2026, event contracts had formed multiple parallel paths: regulated centralized markets, on-chain prediction markets aimed at global users, and short-cycle products designed around price fluctuations. Each product corresponds to a different type of information, a different way of participation and a different risk structure.

7. From “predicting public events” to “trading market outcomes”

The product boundaries of event contracts are expanding. Early markets mainly answered questions like “who will win the election” or “will a certain policy be passed”; the new generation of products can also answer “after a specified period, will BTC be higher or lower than its current level?”. Both types of contracts turn uncertain outcomes into clear conditions, then settle after expiration based on pre-announced rules.

They aggregate different types of information. Political and macro event markets absorb news, research and public information, with longer cycles; short-cycle price event markets absorb real-time market prices, volatility, order flow and directional judgment from traders, closer to high-frequency market trading.

This evolution has made event contracts a universal product structure. Users do not need to handle complex position parameters, yet can still express views around a clear outcome. As a result, the product experience has also expanded from “finding an event worth predicting” to “quickly expressing a directional view in a familiar market”.

8. TurboFlow: event contracts enter the on-chain trading landscape for retail users

The event contracts market is developing along multiple paths: some platforms emphasize institutional development and legal frameworks, using standardized rules to enhance market credibility; others emphasize global accessibility and on-chain execution, using transparent mechanisms to reduce geographic and infrastructure barriers; and some are beginning to explore shorter-cycle event products that are closer to trading scenarios, aiming to lower the participation threshold and improve capital efficiency.

TurboFlow represents this third exploratory path. It is an on-chain trading platform for global retail users, integrating Perpetuals (hợp đồng vĩnh viễn), Event Contracts (hợp đồng sự kiện), and Prediction Markets (thị trường dự đoán) into a single trading ecosystem, with the aim of making professional trading products simpler and easier to participate in.

In TurboFlow's event contracts, users can make judgments about the price direction of BTC, ETH, and gold after a defined cycle. The entry threshold is as low as 2 USD, and one trading round can be completed in as fast as 30 seconds. Clear directional choices, fixed expiration times, and potentially visible outcomes in advance help lower the barrier to understanding and operation.

TurboFlow also places event contracts within a complete trading ecosystem. Users can choose short-cycle Event Contracts based on market judgments, or use perpetual contracts to manage longer directional exposure.

At the market infrastructure level, TurboFlow introduces professional market makers to provide liquidity, while supporting a more market-like trading experience through transparent on-chain execution. The platform's product direction continues the price discovery logic emphasized by Hayek: different judgments from participants enter the market, while prices and odds change with supply, demand, and information.

TurboFlow and Polymarket show two typical application scenarios for event contracts. Polymarket allows users to trade public events such as politics, economics, and culture, while TurboFlow expands into short-cycle market outcomes and at the same time connects event contracts with perpetual contracts. As a result, event contracts obtain a broader time spectrum while also reaching more user groups with varying levels of experience.

9. After widespread adoption, what still matters for event contracts

Looking back at this history, the long-term value of event contracts comes from three factors.

First, the rules must be clear. The underlying asset, observation time, data source, and settlement conditions need to be clearly displayed before trading.

Second, the market needs liquidity. The number of participants, the quality of market makers, and the depth of the order book will all affect whether prices can absorb information in a timely manner, as well as the user's actual trading experience.

Third, risk must be understood correctly. Binary outcomes mean that profit and loss are concentrated at the time of settlement, while short-cycle trading will amplify volatility and timing effects. Market prices and odds reflect traders' judgments under specific rule and liquidity conditions, rather than a guarantee of the outcome.

These principles connect IEM, Polymarket, Kalshi, and TurboFlow. Although technology and interfaces continue to change, trustworthy rules, transparent execution, and sufficient liquidity remain the foundation for the next expansion of event contracts.

Conclusion: From information markets to a gateway for everyday trading

From the crowd's prediction in 1907, to the way Hayek explained the price mechanism; from Iowa Electronic Markets in 1988, to Polymarket bringing prediction markets onto the blockchain, and then TurboFlow integrating short-cycle Event Contracts with perpetual contracts into a single platform, event contracts have completed a long evolutionary journey from idea, to experiment, to market, and then to product.

This history also shows why event contracts continue to grow: people always need a simple way to express a view about the future. Today, event contracts can cover political outcomes months ahead, as well as the direction of the market 30 seconds ahead. The time horizon has shortened, participation has become lighter, and the logic of price discovery continues.

If traditional prediction markets mainly used medium- and long-term event trading to aggregate participants' views on the future, today's short-cycle event contracts have extended that mechanism into trading scenarios with shorter time frames and higher frequency. For TurboFlow, this evolutionary path points to a more specific goal: to let more everyday users participate in on-chain trading supported by real market liquidity, transparency, and understandability.