Why Two Venues Price the Same Event Differently
A price gap between two prediction markets is usually not an error. Here are the structural reasons the same event trades at different numbers in different places.
Open the same event on two venues and you will frequently find two different prices. The intuitive reaction is that one of them is wrong. Usually neither is, and understanding why is the foundation of every other page in this category.
The questions are not identical
This is the biggest one and it is almost always underestimated.
Two markets can share a subject and differ in the source that settles them, the exact threshold, whether the comparison is strict or inclusive, the deadline, the treatment of a tie, and what happens if the underlying data is not published. Any one of those differences makes the contracts genuinely different products.
A price difference between two different products is not a mispricing. It is a price difference. Resolution differences catalogues the specific ways this happens.
The participants are different
A regulated US futures venue and an on-chain venue attract different people, with different beliefs, different constraints and different alternative uses for their capital.
Where the populations differ, the aggregated opinion differs. That is not a failure of either market. Two rooms full of different people can reach different conclusions honestly, and the price is a weighted aggregate of whoever showed up.
Costs differ, and costs are in the price
Fee structures are not the same. A fee that scales with price times one minus price behaves differently from a flat fee, which behaves differently from no fee and a wider spread. Market makers price their costs into their quotes, so different cost structures produce different quotes for identical risk. How fees eat an edge.
Access is not symmetric
Not everyone can use both venues. Jurisdiction, verification requirements, comfort with self-custody and the practical difficulty of moving capital all restrict who can act on a difference.
An opportunity that only a small number of people can act on gets corrected slowly, or not at all. This is the single most important reason gaps persist: not that nobody sees them, but that the set of people who can act on both sides at once is small. Persistent versus temporary gaps.
Capital is not free
Closing a gap means committing capital on both sides until settlement. For a contract resolving in six months, a four-cent gap is an unattractive return on locked capital once you account for the time and the risk that the two questions diverge at resolution. The gap is not being ignored; it is being correctly judged as not worth the capital. Capital lockup.
One side is stale
The most common cause of a large apparent gap, and the least interesting. One venue has not traded that market in a day. Its price reflects yesterday. The gap you measured is a gap in time, not in opinion. Stale quotes and timing.
Liquidity differs
A price on a book with thirty contracts is not comparable to a price on a book with five thousand. You can measure a difference between them; you cannot trade it in any size. Gap size versus liquidity shows the relationship, which is depressingly consistent.
What this site does about it
It measures the difference, grades how comparable the two questions are, and reports the result as a theoretical cross-market edge — the number the prices imply before any of the above is taken off.
That phrasing is deliberate and it is not hedging. Every item on this page comes out of the headline figure before anything real is left. Cross-market gaps is the live table and what a gap is actually worth does the subtraction in full.
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Educational content only. Nothing here is financial advice, a solicitation, or an offer to trade. Prediction markets can move against you and a position can lose its entire value. Where this guide describes a difference between venues it describes a theoretical cross-market edge in observed prices, which is not a profit: fees, spreads, capital lockup, transfer time and differing settlement rules all come out of it first.
Keep reading
Cross-Market Gaps · 3 min readWhat a Cross-Market Gap Is Actually WorthTake a six-cent gap between two venues and subtract every real cost, one line at a time. The remainder is the honest number, and it is much smaller.
Cross-Market Gaps · 3 min readHow Equivalence Grades Work, and Why They Matter MostBefore comparing two prices you have to decide whether the two questions are the same. That judgement is graded, and the grade matters more than the gap.
Cross-Market Gaps · 3 min readResolution Differences That Break a ComparisonThe specific ways two markets on the same subject can resolve differently: sources, vintages, deadlines, ties and the fallback when data never arrives.
Forecasting and Calibration · 3 min readWhere the Wisdom of Crowds Runs OutAggregated opinion beats most individuals most of the time. The conditions it depends on are specific, and prediction markets sometimes fail to meet them.