Definition ∞ Event token trading involves buying and selling digital tokens whose value is tied to the outcome of specific real-world events. These tokens represent a share in a prediction market, where participants speculate on future occurrences like election results or sports outcomes. The price of an event token fluctuates based on perceived probabilities, settling at a fixed value if the associated event occurs.
Context ∞ Event token trading platforms are gaining traction as a decentralized method for aggregating information and forecasting future events. While offering novel ways to participate in predictions, these markets also raise regulatory questions concerning gambling laws and market manipulation. The sector is watching for clearer legal definitions and operational guidelines to support its expansion.
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