Bets totaling over seven hundred thousand rand were placed on the Johannesburg mayoral elections. A single account contributed the largest share to these bets.
Market for Political Event Predictions
According to News24, over R700,000 was bet on the Polymarket platform regarding who will become the next mayor of Johannesburg. This American prediction market platform allows users to purchase 'yes' and 'no' contracts concerning political outcomes. Unlike bookmakers, Polymarket enables traders to take opposing sides of each other's bets, with prices changing depending on market movement.
Candidates and Current Odds
Until now, South African markets on Polymarket and Kalshi have mainly focused on sporting events, but the situation appears to be changing. The Johannesburg mayoral market, according to screenshots, opened last month and includes candidates such as Helen Zille, Loyiso Masuku, Herman Mashaba, Frank Chikane, and David Mahura. At the time of this report, slightly over $43,000 (equivalent to R700,000) was placed on who will lead the City of Johannesburg after the municipal elections.
Influence of a Single Investor
In a screenshot, Helen Zille, chairperson of the DA federal council, had an implied probability of 67%, Chikane at 14.1%, and Mahura at 2.6%. A significant portion of the funds supporting the 'yes' position for Zille is presumed to have come from one account that reportedly held over $500,000 (approximately R8.6 million) in open positions on this platform. This makes the market interesting, but not necessarily useful as a pure indicator of political reality, as niche markets can look very dramatic when one decisive trader exerts pressure.
Regulatory Questions
There are also some regulatory issues. Earlier this year, News24 visited Polymarket, created an account, deposited cryptocurrency, and made its first prediction within 35 minutes. South Africa is not included in the list of countries where restrictions apply for either Polymarket or Kalshi, but Zimbabwe has already demanded that both platforms ban the use of their services in its territory. Currently, South Africa is in the process of determining who is responsible for this issue.
Potential Supervisory Bodies
These platforms are likely under the jurisdiction of either the Financial Sector Conduct Authority (FSCA) or the National Gambling Board (NGB). The FSCA previously stated that it cannot provide an official assessment while awaiting research from the International Organization of Securities Commissions. It was also confirmed that neither Kalshi nor Polymarket had applied to the FSCA for a license. In March, the NGB stated that it did not 'consider it a gambling game' and was unaware of any prediction company applying to the provincial gambling regulator for a license.
Electoral Commission's Stance
The South African Electoral Commission was also polled about its concerns ahead of the November local elections but acknowledged that its concern would only arise if any platform or information published through it were used to illegally influence voters or spread false information. Until now, the Johannesburg mayoral elections have been running with live odds, which seems appropriate for a city where potholes and access to basic services are a daily lottery.
