Recently, HTX Research, the dedicated research department of the cryptocurrency exchange Huobi HTX, released a new research report titled "Prediction Markets: From Structural Bottlenecks to Infrastructure Revolution and the Future of Attention Assets," which systematically analyzes the structural foundation, current development status, and potential path of the prediction market sector towards attention assets. The report focuses on the structural constraints faced by prediction markets during their rapid growth, and whether prediction markets can become the core infrastructure supporting attention assets. The report also highlights the emerging forces in attention assets: the differences between prediction markets and Memecoin. Prediction markets have experienced significant growth over the past year. Statistics show that the cumulative trading volume of global prediction markets reached $27.9 billion in the first ten months of 2025, a 210% increase compared to 2024. Similar to Memecoin, prediction markets are also a sector based on attention as their value foundation, and both attract a large amount of small capital, but they represent completely different trading logics. In prediction markets, traders can diversify their portfolios based on the information and event structure they possess, fully understanding their loss limits; the odds are transparent, making risk predictable. In low-volume events, small traders with domain knowledge can even find arbitrage opportunities arising from information asymmetry. Memecoin's participation logic is entirely different. Taking Pump.fun as an example, of the 10,417 tokens created daily, 98.6% were identified as manipulative projects by research reports, with an average lifespan of less than three months. In this market structure, information is primarily concentrated in the hands of the project creators, and price movements rely more on social media dissemination and short-term sentiment than on event logic or probability judgments. The probability curves in prediction markets also have social dissemination effects, but their driving force is event dynamics and market consensus, rather than simple narratives and FOMO. For ordinary traders, this means that the participation logic of prediction markets is closer to "information games," while Memecoin is more like an "attention-driven stochastic process." Behind the rapid expansion: a still fragile infrastructure. Despite rapid growth, this has not brought a stable foundation to prediction markets; their actual operation still exposes unresolved structural vulnerabilities. Currently, prediction markets still rely on incentive subsidies to maintain liquidity. For example, some platforms need to invest tens of thousands of dollars daily for market making during peak periods, and liquidity weakens significantly after subsidies decrease. Furthermore, because the value of the losing party in an event contract immediately becomes zero, the market lacks a mechanism for continuously accumulating depth; the closer to settlement, the more advantageous informed traders become, making market makers bear greater risks. In terms of user experience, the way events are expressed remains relatively simple. Insufficient market discovery, high entry barriers for event creation, and the pace of oracle settlement all limit the scale of expansion. Overall, while prediction markets have demonstrated strong growth potential, their underlying structure remains in the exploratory and repair phase. The next generation of prediction markets is experiencing innovative breakthroughs. Faced with structural problems such as insufficient liquidity, limited market discovery, limited expressive power, and challenges in oracle settlement, the industry is exploring new systemic solutions. In terms of liquidity, Just-In-Time (JIT) mechanisms improve capital utilization efficiency by injecting funds only when actual demand arises; continuous portfolio markets attempt to address the fragmentation of liquidity caused by traditional event dispersion, enabling traders to express their views within continuous price ranges. Regarding expressive power, various new prediction structures are emerging. From perpetual contracts built on prediction market data to binary option structures around short-term price fluctuations, and innovative mechanisms for trading "probability changes" themselves, prediction markets are gradually breaking through the original binary framework. Distribution models are also transforming. The event trend charts and probability changes in prediction markets are naturally suited for social dissemination. New platforms are attempting to embed trading entry points into social networks, transforming prediction markets from traditional platform formats into a "financial format" that can spread naturally within information flows. While these innovations haven't solved all structural problems at once, they demonstrate a clear direction for the prediction market ecosystem towards greater scalability. The Development Potential of Prediction Markets HTX Research points out that attention assets are becoming the third largest asset class after cash flow assets and supply and demand assets. Currently, representative attention assets include BAT and KAITO. Huobi HTX market data shows that BAT has recorded a gain of over 30% in the past 30 days, while KAITO was a market hotspot in the first half of this year. In addition to these projects, HTX Research believes that prediction markets have the potential to become the core pricing infrastructure for attention assets. Currently, user-generated assets (UGAs) such as NFTs and creator tokens are mostly priced from scratch, making it difficult to reflect the true level of existing cultural influence or public attention. In contrast, multiple predicted events surrounding the same topic naturally possess price, liquidity, and time dimensions, and can be aggregated into an "attention index." This mechanism has three key characteristics: Higher manipulation costs: Influencing the attention index requires actually buying the predicted event, making manipulation costly in terms of capital. Reflects existing attention: It doesn't need to start from scratch and can measure topics that already have attention, such as celebrities, sports performance, and political events. Has two-way trading capabilities: Both increases and decreases in attention can be financially expressed. If this direction matures, prediction markets will no longer be merely event settlement tools, but could become a key foundational layer connecting culture, social interaction, and finance, providing a price basis for new derivatives such as Attention Perps. This means that the mission of prediction markets will expand from "predicting event outcomes" to "measuring and pricing attention itself," thus playing a more strategic role in the future digital economy. Conclusion: Prediction markets are at a critical juncture, transitioning from a growth phase to a structural upgrading phase. Faced with its own structural bottlenecks, the industry is constantly seeking breakthroughs through innovations in liquidity mechanisms, expression methods, and distribution models. Simultaneously, with the clarification of the concept of attention assets, the role of prediction markets is also changing—it may become one of the underlying infrastructures for the future convergence of culture and finance. Compared to the emotion-driven Memecoin ecosystem, prediction markets, with their probability and information-centric mechanisms, possess stronger sustainability and a deeper capacity for value expression. As their structure matures, their position within the digital asset system is expected to continue to rise. About HTX Research HTX Research is the dedicated research department of Huobi HTX, responsible for in-depth analysis, comprehensive reporting, and professional assessments across a wide range of areas including cryptocurrencies, blockchain technology, and emerging market trends. HTX Research is committed to providing data-driven insights and strategic foresight, playing a key role in shaping industry perspectives and supporting informed decision-making in the digital asset space. With rigorous research methodologies and cutting-edge data analysis, HTX Research remains at the forefront of innovation, leading industry thought and fostering a deeper understanding of ever-changing market dynamics. Visit us.
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