Midterm markets capture Democratic sweep but miss South Carolina upset

Prediction markets correctly signaled the broad outcome of the United States midterms, with Democrats taking control of both the Senate and the House, according to Reuters. More than 1.48 billion dollars was wagered on Tuesday elections.

Election trading expands

Kalshi’s total election-market trading volume exceeded 2.5 billion dollars this cycle, Reuters reported, compared with 1.3 billion dollars in the 2024 cycle. The figures show a substantial increase in activity on the platform between the two election cycles.

Polymarket’s election forecasts were about 98 percent accurate, according to Reuters. That figure accompanied a correct overall call on congressional control, though the supplied summary does not explain how forecast accuracy was measured.

South Carolina delivers a notable miss

One prominent exception came in South Carolina, where Democrat Annie Andrews defeated Republican Darline Graham. Markets had assigned Graham a 70 percent chance of winning, Reuters reported.

The result illustrates the distinction between identifying a favorite and guaranteeing an outcome. A 70 percent implied probability still leaves room for defeat, even when markets correctly anticipate the broader electoral picture.

What it means for prediction markets

• Broad success, local uncertainty: Markets captured Democratic control of both chambers, but South Carolina showed that individual contests could diverge from the favored outcome.
• Higher participation: Kalshi’s election volume rose from 1.3 billion dollars in the 2024 cycle to over 2.5 billion dollars this cycle.
• Accuracy needs context: Polymarket’s reported accuracy of about 98 percent is notable, but the summary provides no methodology for assessing that measure.