Recently, many people have been debating how to play the prediction market. To be honest, if you're in the crypto space, you need to choose between two directions. One is the fully decentralized Web3 approach, and the other is the traditional financial route with the established players. Today, we'll explore both sides.

First, let's talk about the differences in architecture and positioning. One side includes platforms like Polymarket, built on the Polygon chain, using USDC for settlement, with a completely decentralized approach. The characteristic of this side is that the topics are diverse—ranging from political elections to trending internet celebrities. The other side is Kalshi, a compliant exchange regulated by the U.S. CFTC, settled in USD, following the traditional financial model. The user groups are entirely different: Polymarket attracts crypto veterans and DeFi enthusiasts, while Kalshi targets local U.S. users and institutional funds, with a strong emphasis on compliance.

As for retail investors, the main concern is how to make money. The difference in liquidity is significant. Currently, Polymarket leads in liquidity by a wide margin. What does this mean for retail traders? Lower slippage, meaning lower costs to enter and exit the market. This can save a lot of money during frequent trading.