Polymarket, a leading crypto prediction platform, has become known for outperforming traditional betting markets in forecasting outcomes. But this reputation was tested on Thursday when bettors on the platform drastically missed the mark in predicting the next pope following the papal conclave.

The surprise result, with Robert Francis Prevost emerging as the new pope, shocked the market. Bettors had given the U.S.-born cardinal just a 1% chance of winning, while the top odds were placed on Cardinal Pietro Parolin, who had a 28% chance according to Polymarket users.

In total, more than $28 million in bets were placed on candidates other than Prevost, resulting in a significant loss for many Polymarket bettors.

This unexpected outcome raises questions about the reliability of prediction markets like Polymarket, especially in comparison to traditional polling methods.

Polymarket’s betting model differs from conventional platforms: instead of odds being set by a bookmaker, the market prices on Polymarket are determined by users’ bets in real time. As more people place bets on a particular outcome, the odds adjust accordingly, making the platform a real-time reflection of collective sentiment.

The platform gained attention in 2020 when Polymarket bettors were seen predicting U.S. election outcomes with greater accuracy than traditional polls, particularly in forecasting Donald Trump’s chances. Experts at the time suggested that Polymarket offered a slight advantage due to the insights it provided from decentralized, market-driven data.

However, Polymarket’s prediction track record was put to the test with the papal conclave. According to Domer, a top pseudonymous bettor on the platform, predicting the outcome of such a rare and secretive event is inherently difficult. “It’s a guessing game without much real information,” Domer explained. “Even those directly involved wouldn’t have a clear idea of how to predict it.”

As a result, many Polymarket bettors likely relied on external media and traditional betting markets for guidance, which could explain the heavy favoritism shown toward certain candidates like Parolin and Tagle, whose odds were inflated by their media visibility and public popularity.

Moreover, the rarity of papal conclaves—this was the first since Pope Francis’s election in 2013—meant that Polymarket bettors may have had limited experience with the event, unlike the frequent and widely understood political elections where the platform has historically performed better.

Domer also noted that the true value in betting on such rare events might lie in betting against candidates with overblown odds. “The favorites were priced way too high, largely because of media hype rather than solid insight,” he said.

In conclusion, the misstep with the papal conclave underscores the inherent challenges in predicting rare events through crypto-based prediction markets. While platforms like Polymarket may have a strong track record in more common events, they can face significant difficulties when it comes to events shrouded in secrecy and uncertainty.

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