What are climate prediction markets?
Think you know your way around a weather forecast? Maybe you’re always good at predicting when snow’s due in your local area? If you’re interested in all things related to weather and climate, then you may like to participate in climate prediction markets available at sites like Crypto.com, Kalshi, and Polymarket. These platforms give users the chance to make predictions on a whole host of climate-related events, be it basic things like expected rainfall, the chance of snow in your hometown, or the risk of natural disasters and other seismic weather events across the globe.
We’ll cover exactly how climate prediction markets work a little later in our guide, but suffice it to say that these platforms may be exceptionally easy. Most markets are based on simple “Yes” or “No” trading mechanics, with your job being to correctly predict the outcome of a weather or climate event, and turn a profit in the process.
It’s worth noting that, while making climate and weather predictions might be fun, using prediction markets isn’t without its risks. You can lose significant money on these platforms if you invest heavily in incorrect trades, so never trade beyond your comfort zone and always have a personal loss limit in mind.
Are climate prediction markets legal in the USA?
Yes, it’s generally legal to make predictions on climate events on US prediction markets. However, there are some things to consider from the outset.
First up, note that you should only ever trade on platforms that are licensed and regulated by the Commodity Futures Trading Commission (CFTC). This is the federal institution that oversees derivatives event trading contracts in the USA, and without its backing, platforms like Kalshi and Crypto.com would not be able to offer their services in your state on a legal basis.
Meanwhile, note that, while CFTC licensing should mean that you’re able to use a specific prediction market, some region-specific restrictions may apply. Lawmakers in some states have raised concerns about these services, so in some jurisdictions, certain brands or markets may be prohibited or unavailable. Always check the T&Cs of the site you’re hoping to use, just in case there are any conditions, rules, or restrictions that might affect your trading experience.
Deposit $20 get $50 $10 Bonus 100% up to $250
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How do climate prediction markets work?
We recently put together a detailed guide on political trading sites, along with markets like economy, culture, and tech. But given that these topic categories are based on completely different events, it’s worth taking a look at how climate prediction markets work individually, too.
Climate event trading is a pretty broad market category, covering everything from localized weather events to major climate statistics and natural disasters. However, regardless of what you’re trading on, the basic mechanics of using prediction market tools like Kalshi, Crypto.com, and Polymarket remain largely the same – great news for beginner traders looking to use these types of sites for the first time.
With all that said, let’s take a closer look at how to get started with prediction market trading on climate issues.
Getting to grips with the basics of climate event trading
When you access climate prediction markets online, your job is to predict the outcome of an event correctly. Typically, you’ll be presented with a question or scenario, and must decide what the outcome of that particular event will be.
While there are several different trading formats at top prediction markets in the USA, the most prevalent is the binary “Yes” or “No” system. Here, you choose “Yes” if you think an event is likely to happen and “No” if you believe it won’t; you’ll buy a position based on your prediction, and could turn a profit if you get it right.
Let’s say you’re asked the question, “Will the temperature in NYC reach 67°F today?”. You’re then presented with two different contract options: “Yes” or “No”.
Each of these contracts is priced from $0 to $1, with their value denoting probability. So, if the “Yes” contract was priced at $0.60 per share and the “No” was priced at $0.40, this suggests 60% probability and 40% probability respectively.
The price, and therefore the probability, of different event contracts is driven by a number of metrics. For instance, a change in the weather forecast could skew the markets in either direction, while market and trading activity can also influence the price you’ll pay for individual event contracts.
What’s the score with making a profit on climate prediction markets?
Turning a profit when trading on climate events relies on making correct predictions. But how is profit actually rewarded? And in what scenario would you make a loss?
So, when an individual event contract resolves, it’s valued at $1 for a correct prediction and $0 for an incorrect prediction. Returning to our earlier example, if you’ve purchased 150 “Yes” contracts at $0.60 per share (equating to a total $90 investment), you would receive $150 in returns if the temperature in NYC did hit 67°F on the date in question. That would give you a $60 profit ($150 minus your initial $90 stake).
But what happens if the temperature doesn’t reach 67°F? In this instance, your trade would settle as a loss, with your $90 investment valued at $0. You can only ever lose what you invest when using online prediction markets, which do offer some useful control and oversight over your exposure to risk.
It’s worth noting, too, that you can sell or add to your position at any time, right up to the point where an event is scheduled to resolve. That means you can double down on your prediction in hopes of turning an even greater margin of profit, or else sell your position prematurely if a new forecast suggests that the temperature could peak above 67°F, allowing you to recoup before a loss.
Here’s a quick step-by-step look at how to use climate event trading platforms
Still not feeling comfortable with how to use climate prediction markets? Then perhaps our step-by-step guide might help you to see the wood for the trees.
Our experts have together a concise guide to the event trading process. This applies whether you’re forecasting the latest climate outcomes or looking to use sports prediction markets.
- Cast your eye over our recommended prediction markets below, including Kalshi, Crypto.com, and Polymarket. These are platforms offering climate event trading, but these are some of our favorites.
- Get started with our preferred prediction market platform by registering for a new account. The CFTC requires prediction markets to verify each and every new trader, so you may need to complete a variety of checks – including Know Your Customer (KYC) verification – when joining a new event trading platform.
- Once your account is set up and ready to use, you’ll need to add some trading funds before you can start making monetized predictions. Simply head to your platform’s cashier screen, select your preferred payment method from the options available, and follow the steps on screen to complete your transaction and add funds to your account.
- With this step taken care of, you’re now ready to start exploring all the different live and future trading markets that are available. Tap the “Climate” option and browse through all the different markets, paying attention to the price of each individual “Yes” or “No” contract.
- Tap the market you would like to trade on and review all the information provided. You can see probability denoted as the contract price, along with information on how and when the market will resolve and the specific parameters required for it to settle as a “Win” or a “Loss”.
- Execute your trade by selecting how many contract positions you would like to purchase for the event in question. As you submit a different number of shares, this will adjust your total potential profit. You can also review the trading fee, which is levied by the prediction platform whenever you’re buying or selling positions.
- With your trade locked in, the waiting game begins. Remember that you can buy more shares or sell your position at any time before the event resolves.
- Once the trade is finalized, any profits you’ve accrued by making a correct prediction will be automatically allocated to your account. If you end up making an incorrect prediction, your balance will remain the same, since you’ve already purchased the position.
Five examples of climate prediction markets and categories
Much like when trading on culture, the scope of climate prediction markets is surprisingly varied. As such, we thought it would be useful to outline some of the core types of events, categories, and topics that fall under the remit of climate event trading, so you can get a handle on the types of trades that you can make on these innovative prediction tools.
| Type of prediction | Key details | Example |
| Climate change targets | Make predictions on which countries will meet their obligations and when. | Will the USA meet its climate change targets in 2026? |
| Daily temperature | Popular climate event trades concern basic weather patterns, including daily temperature trends in different locations around the USA. | Will the temperature in NYC reach 67°F today? |
| Snow and rainfall predictions | Predict the chance of precipitation in locations across the country. | Will it snow in Philadelphia this month? |
| Natural disasters | Predict when hurricanes, earthquakes, and other rare climate events will happen around the world. | Will there be over 200 tornadoes in the USA this month? |
| General climate statistics | Some event trades fall under a general umbrella of weather and climate statistics, including things like hottest month on record, etc. | Is this March the hottest March on record? |
Our recommended prediction markets to try for climate event trading
Now that you know pretty much all there is to know about climate prediction markets, it’s time to take a look at some of the platforms we recommend for this kind of event trading. Alongside trading on the economy, climate is a core topic category on lots of US prediction markets, so you should have no problem finding a place to make your best-guess predictions a reality.
Here, we’re sharing three brands that should provide a safe place for climate event trading, including Kalshi, Crypto.com, and Polymarket.
| Prediction Market Sites | Welcome Offer |
| Polymarket | Deposit $20 Get $50 |
| Kalshi | $10 Bonus |
| Crypto.com | 100% up to $250 |
| OG | Trade $20 Get $20 Bonus |
| Underdog Predict | No bonus at the moment |
| PrizePicks | Trade $5 Get $50 Bonus |
| Fanatics Markets | Up to $100 Bonus |
| Fanduel Predicts | $25 Bonus |
| Robinhood | Up to $200 Bonus |
| Coinbase | N/A |
| Draftkings Predict | 100% Match up to $10 |
| MooMoo | N/A |
| ROLR | N/A |
| Gemini | N/A |
| WeBull | N/A |
| Interactive Brokers | $10 Bonus |
| Novig | N/A |
| ProphetX | N/A |
| TruthPredict | Not fully live yet |
Kalshi – A whole host of climate-related trading opportunities
- Sports, politics, and crypto predictions
- Economics, culture, and climate events
- Optimized Android and iOS apps
- 2% debit card deposit fee
We’ve always had a good time using Kalshi, with the platform’s simple pick-up-and-trade mechanics making it an engaging place to make predictions as a novice trader. Of course, it also benefits from a rich depth of market variety, with Kalshi’s “Climate” trading hub offering a whole host of sub-categories covering everything from natural disasters to daily temperature averages and much more.
Part of the appeal of using Kalshi is that the platform is super accessible wherever you’re located in the USA. This was one of the first prediction markets to receive the full backing of the CFTC, so it’s available to use in all 50 US states with little to no regional restrictions on the types of trading markets you can access and where.
Polymarket – Climate prediction markets are scheduled to launch at Polymarket soon
Crypto.com – Full CFTC approval makes Crypto.com a standout prediction market
- Unique real-world climate prediction markets
- Simple peer-to-peer trading experience
- Fast and secure payment options
- Very limited climate prediction variety
Crypto.com helped revolutionize the use of prediction trading markets in the USA, with its platform being one of the first to receive full accreditation from the CFTC alongside Kalshi. So esteemed is Crypto.com’s derivatives trading markets that several other brands use its platform through their own services, so you might come across the brand even when using other trading apps.
Returning to Crypto.com's core attributes, it’s worth noting that you can add and withdraw funds using both fiat and cryptocurrencies – a first for these types of trading platforms. Its climate trading markets are super varied, too, giving you the scope to trade on everything from rainfall statistics to natural disaster occurrence.
Sponsored by Crypto.com – Not investment advice. Trading prediction markets and crypto involves risk, including potential loss of your stake. Consider your risk tolerance before participating. Crypto.com connects U.S. users to CDNA (regulated by CFTC) for derivatives trading. CDNA membership required. Trading may not be suitable for all—you could lose your entire investment plus fees. Past performance doesn't guarantee future results. This is not a solicitation or recommendation to trade.
Pros and cons of climate prediction markets
If you ever thought about making predictions on the weather or climate, here’s a quick look on the good and not so-good side about climate prediction markets:
- Trade on weather and climate events
- Predict things like average temperature and rainfall
- Forecast natural disasters
- Some platforms are CFTC licensed
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That’s a wrap on our guide to climate prediction markets
So, there you have it, a complete guide to climate prediction markets. Climate and weather events often make the headlines in the USA, so it’s easy to see why these topics attract high trading volumes. Just remember that, while it might seem fun and lighthearted, trading on any event outcome is a serious business that could result in financial loss.
If you’re excited to try your hand at climate event trading, use the links on this page to learn more about our recommended trading platforms, including Kalshi, Crypto.com, and Polymarket.
Check out our climate prediction market sites
Deposit $20 get $50
- Predict snow and rainfall in your local area
- Guess when climate targets will be hit
- Forecast worldwide weather events
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- Climate change and daily temperature
- Hurricanes, tornadoes, and other natural disasters
- Snow and rainfall predictions
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- Limited selection of prediction markets relating to the hottest year on record
- Useful chart information showing price trends over time
- Trade contracts relating to actual placement in terms of temperature records
Climate prediction market FAQs
What do climate event predictions include?
From natural disasters and significant climate events to daily temperature averages and the chance of rainfall, you can make a whole host of predictions related to the climate at our favorite event trading portals.
Can you win money through climate prediction trading?
That may be possible, but it does rely on making correct predictions on different climate events.
Which are the best platforms for climate event trading in the USA?
If you want the biggest selection of markets and easy trading mechanics, try Kalshi, Polymarket, and Crypto.com.
