Online prediction markets have become big business south of the border, letting people bet on everything from reality TV outcomes to geopolitical crises. Now those same platforms, including Kalshi and Polymarket, are taking bets on B.C.’s municipal elections this October. For example, on Polymarket, wagers can be made on who will be the next mayor of Vancouver, Burnaby, and Surrey, but some experts say the odds may be based more on “vibes” than reliable information. Werner Antweiler, an economics professor at UBC’s Sauder School of Business, said people should approach the market projections with a heavy dose of skepticism. “Voters should be rather worried about the quality of the information they’re getting out of these prediction markets because they are not administered with levels of transparency and accountability that ensures that the information that is reflected by the prices is truly meaningful,” he said. “So, there is every opportunity for people to try and manipulate these prices for partisan gain.” Antweiler added, like gambling, there is a significant risk people will lose money if they choose to partake. “It is not reliable,” he said. “It is not meeting any scientific standards.” ‘Who are all these traders?’ According to Polymarket’s website, B.C. is listed as one of its geographically restricted locations, but Antweiler said people are finding ways to get around this, such as using a VPN, or virtual private network. “The question is, who are all these traders?” he asked. “There’s a really good reason to think that these are local people who are following local politics.” Mario Canseco, the president of Research Co., warns prediction markets shouldn’t be confused with public opinion polling. “If you don’t know the difference, that is where the situation can be very detrimental because voters are going to get an idea of what is happening, which isn’t really backed by the data science that people like me have been using for decades,” he said. Canseco points to his own polling as an example. Before Research Co. published its Vancouver mayoral poll results on Aug. 4th, opposition candidates were sitting at the top of the prediction markets. After the poll came out, Canseco said, one of those candidates, OneCity’s William Azaroff dropped to fourth place. “So, is this the poll moving the market?” he asked. “Is the market reacting to the poll, or is this really the wisdom of the crowd, as these guys like to say.” Regulators respond In a statement to CTV News, the British Columbia Lottery Corporation said, “As a Crown corporation in British Columbia responsible for conducting and managing commercial gambling on behalf of the province, BCLC believes it would be inappropriate to offer betting on municipal, provincial or federal politics.” In April, the Canadian Securities Administrators and the Canadian Investment Regulatory Organization issued a joint press release regarding the existing securities law applicable to prediction markets and event contracts. The release emphasized that, “to date, no prediction market has been recognized as an exchange or registered as a dealer by the CSA.”
