Build Institutional Grade Prediction Markets on Arc | Arc Blueprints
Summary
Prediction markets are evolving across many use cases into robust and institutionally relevant financial platforms. This post explores how Arc can give builders the infrastructure to create usable, credible, and globally accessible onchain prediction markets with stablecoin gas, multi-currency settlement, and compliance-ready architecture.
Arc,1 the Economic OS for the internet, is a stablecoin-native Layer-1 designed for real-world economic activity. Arc is designed to give builders a foundation for financial applications that need predictable execution, fast settlement, and real-world usability, powered by deterministic finality, fiat-denominated gas, and infrastructure designed to support compliance workflows.
Prediction markets, whose volumes have quadrupled over the past two years, are a strong fit for this infrastructure. Already used across a range of event-driven and forecasting applications, they are increasingly being recognized as tools for coordination, price discovery, and market-based information discovery. With the right foundation, builders can design prediction markets that are more usable, credible, and relevant to real-world applications.
What are prediction markets?
Prediction markets enable participants to trade on the outcome of future events, with prices reflecting real-time expectations. They’ve existed in various forms, from centralized platforms like Intrade to blockchain-native protocols like Augur and Polymarket — and have been applied across elections, macroeconomic trends, and corporate events.
What’s changing is how broadly prediction markets can be applied. With the right infrastructure, builders can extend them into more forecasting, coordination, and decision-making contexts with greater flexibility in how markets are designed and deployed. This is where purpose-built infrastructure matters: platforms like Arc, with stablecoin-native execution, integrated FX, and support from Circle’s full-stack ecosystem, make it possible to design prediction markets for broader participation across geographies, currencies, and user types.
How Arc supports next-generation prediction markets
Prediction markets can serve not only as trading venues, but also as onchain information infrastructure. They can aggregate market signals, help participants coordinate around uncertain outcomes, and settle in real time. Arc will provide builders with core primitives to support those kinds of applications.
In practice, that means addressing several of the constraints that limit today’s prediction-market platforms:
On Arc, builders can create experiences that are more globally adaptable, with support for localized market design and participation across currencies and jurisdictions. Gas can be paid in stablecoins, making transaction costs more predictable and eliminating the need for users to acquire and manage a separate volatile gas token. And for applications that require stronger operational controls, Arc is designed to support compliance workflows with opt-in privacy, auditability, and programmable policy controls.
Together, these capabilities can help address several of the constraints that limit today’s prediction-market platforms.
Predictable, fiat-denominated gas fees
Arc enables gas to be paid in stablecoins like USDC. For builders, that means transaction costs are easier to model and user flows are easier to design. For users, it removes the need to acquire and manage a separate volatile gas token just to participate.
That matters for prediction markets because many of them depend on low-friction participation and small transaction sizes. Predictable, fiat-denominated costs make it easier to support consumer-friendly market experiences and may improve the economics of lower-stakes forecasting products.
FX and multi-currency prediction flows
Arc will support native onchain FX routing and multi-stablecoin settlement, enabling builders to design markets around the currencies that make the most sense for their users and use cases.
A market tied to European inflation could settle in EURC,3 while a market focused on US policy expectations could settle in USDC.2 Instead of forcing all participants into a single currency model or spreading activity across multiple chains, builders will be able to support more flexible market design on a single stablecoin-native settlement layer.
Architecture for higher-trust prediction markets
For prediction markets to expand into governance, enterprise, or public-interest use cases, they need infrastructure that supports more than fast execution. They also need credible controls around transparency, privacy, and compliance.
Arc’s design helps builders encode requirements such as transfer controls, identity gating, or disclosure flows directly into application logic. Deterministic finality can give markets clear settlement outcomes, while auditability can help support verification and operational trust. Together, these properties will enable Arc to serve as a stronger foundation for prediction markets designed for broader participation and a wider range of real-world use cases.
Emerging use cases for institutional-grade prediction markets
The next generation of prediction markets may expand into a broader set of financial and operational contexts where market-based forecasting can help participants manage uncertainty.
For institutions, one promising direction is event-driven forecasting around macroeconomic releases, policy signals, and other market-moving developments. While traditional instruments can help participants hedge broad exposures, prediction markets can offer a more direct way to express views on discrete outcomes and translate uncertainty into live market-implied probabilities.
This could include markets tied to inflation prints, labor-market data, growth expectations, monetary-policy decisions, or other indicators that shape portfolio positioning and risk management. In these contexts, prediction markets are not necessarily replacing existing instruments. Instead, they can complement them by surfacing a clearer view of how participants are pricing specific scenarios in real time.
A similar opportunity exists around broader geopolitical and operational risk. Institutions often need to evaluate uncertainty related to policy changes, cross-border developments, supply-side disruptions, public-sector decision-making, and other events that influence economic expectations. Prediction markets can offer a structured way to aggregate views around those uncertainties, provided they are built with appropriate market design, controls, and settlement logic.
The broader point is that prediction markets become more useful as they move closer to real-world workflows. To support that shift, builders need infrastructure that can combine usability, deterministic execution, stablecoin-based settlement, and configurable compliance controls. That is the environment Arc is designed to provide.
Build prediction markets on Arc
Arc is designed to support developers with the primitives to build better prediction-market infrastructure, not just faster versions of existing products. With fiat-denominated execution, native FX support, deterministic finality, and compliance-ready architecture, Arc will help builders create platforms that are easier to use, easier to scale, and better aligned with real-world financial applications.
Whether you are building consumer forecasting products, decentralized governance tools, or new forms of onchain information markets, Arc can provide a stablecoin-native foundation to build on. Explore the docs, join the community, and help shape the next generation of prediction markets.
If you’re building a prediction markets app on Arc, show it to the Arc Ecosystem team.
1 Arc testnet is offered by Circle Technology Services, LLC ("CTS"). CTS is a software provider and does not provide regulated financial or advisory services. You are solely responsible for services you provide to users, including obtaining any necessary licenses or approvals and otherwise complying with applicable laws.
Arc has not been reviewed or approved by the New York State Department of Financial Services.
The product features described in these materials are for informational purposes only. All product features may be modified, delayed, or cancelled without prior notice, at any time and at the sole discretion of Circle Technology Services, LLC. Nothing herein constitutes a commitment, warranty, guarantee or investment advice.
2 USDC is issued by regulated affiliates of Circle. See Circle’s list of regulatory authorizations.
3 EURC is issued by regulated affiliates of Circle. See Circle’s list of regulatory authorizations.