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The documented milestones: the 1503 papal bet, Wall Street election betting from 1884, the Iowa Electronic Markets of 1988, HedgeStreet's 2004 approval and the canceled 2003 Policy Analysis Market.
One documented early political bet dates to 1503, when people bet on who would be the papal successor, and it was already considered an old practice then. Pricing political outcomes with money is therefore not a digital-age invention.
According to economic historians Paul Rhode and Koleman Strumpf, election betting in Wall Street dates back to 1884. This places organized political wagering firmly in the nineteenth century, decades before any electronic exchange existed.
On narrow screens, swipe or scroll the plate sideways.
One of the first modern electronic prediction markets is the University of Iowa's Iowa Electronic Markets, introduced during the 1988 US presidential election. The shift from floor betting to screen trading begins here.
In July 2003 the US Department of Defense publicized a Policy Analysis Market; a critical backlash denounced the program as a 'terrorism futures market' and the Pentagon canceled the program. The episode shows how politically charged these instruments can be.
HedgeStreet was the first prediction market to seek approval by the Commodity Futures Trading Commission as a designated contract market after the Commodity Futures Modernization Act of 2000, and it was granted in 2004. Formal regulatory recognition is possible, but it took a specific act of Congress to open the door.
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