How Do Prediction Markets Work? A Beginner's Guide to Getting Started on Signal

Every market has that one person who calls it early.

Before the match ends, they know the scoreline. Before the announcement, they know what's coming. Before the election result, they've already picked a winner.

The rest of us find out later and call it gist. They call it instinct.

A prediction market is what happens when you take that instinct and put a price on it in real time, alongside everyone else's view.

It's not a new idea. But in the last few years, prediction markets have gone from a niche concept to a global phenomenon, with billions of dollars now being traded on events across politics, sports, economics, crypto and culture.

The idea behind them is simple: instead of just asking what people think will happen, you give them a way to trade on that belief. The result is a live market where prices change as people process new information and change their minds.

Signal by Busha brings prediction markets to Nigeria, licensed by the Lagos State Lottery and Gaming Authority. And because it's built on top of Busha, you can get started with the account you already have.

Here's what you need to know before making your first prediction.

What is a prediction market?

Strip away the terminology, and it comes down to one thing: a prediction market turns a question about the future into a market.

Every market on Signal asks a question with two possible outcomes: YES or NO.

Will the Super Eagles win their next match? Will the naira strengthen against the dollar this month? Will Bitcoin close above a certain price?

You buy shares in the outcome you believe will happen.

If you're right when the market resolves, your shares pay out at their full value. If you're wrong, they're worth nothing.

But there's an important detail: you don't necessarily have to wait until the event happens.

If you buy YES at ₦40 and the market moves to ₦70 because traders become more confident the event will happen, you can sell your position before the market resolves and lock in the difference.

That's what makes a prediction market a market. You're not simply placing a prediction and waiting for the result. You're trading a position as information changes.

Is a prediction market the same as betting?

It's an obvious question, especially in a country where sports betting is already familiar.

The mechanics are different.

With a traditional sportsbook, the operator sets the odds for an outcome. You place a bet against those odds, and the outcome determines whether you win or lose.

In a prediction market, prices are determined by trading activity. Participants buy and sell positions against each other, and the price changes as demand changes.

Think of it less like a betting slip and more like a marketplace. If more traders want YES, the price of YES can rise. If sentiment shifts toward NO, the price can fall.

And because you're trading a position rather than simply locking in a fixed bet, you can potentially exit before the event is resolved.

How Prediction Market Prices Work On Signal

This is the part that makes prediction markets particularly interesting.

On Signal, shares trade between ₦0 and ₦100. The price reflects the market's implied probability of an outcome. If YES is trading at ₦70, traders are effectively pricing the event at around a 70% chance of happening. If it falls to ₦30, the market is pricing it closer to 30%.

Signal may set the initial price or provide liquidity in some markets, while prices can also move as people trade based on what they know, what they believe, and how they interpret new information.

And that can happen quickly.

A viral story takes an unexpected turn. A new inflation figure is released. A candidate makes a major statement. Bitcoin suddenly moves 5%.

Traders react, positions change, and the price moves with them.

But a market price is a signal, not a guarantee. 

A YES price of ₦70 doesn't mean the event is certain to happen, or that it will happen exactly 70% of the time. It means traders are currently pricing that outcome at around 70%, based on the information and expectations in the market at that moment.

That can change as the market changes. A price of ₦70 today could be ₦50 tomorrow or ₦90 an hour from now.

The price tells you where the market stands right now. Whether you agree is up to you.

What can you trade on Signal?

Signal launches across six categories:

• Trending News: Major stories and events people are watching
• Sports: Matches, tournaments and transfers
• Crypto: Price levels and market movements
• Culture: Entertainment, awards and viral moments
• Economics: Inflation, interest rates and other economic data
• Politics: Elections and policy outcomes

The point isn't simply to predict one type of event. It's to give you a place to trade your view on the things people are already talking about, and the things they're about to start talking about.

How does a prediction market get settled?

Before you trade, every Signal market tells you exactly how it will be resolved.

You'll see the resolution date, the conditions that determine YES or NO, and the source that will be used to verify the outcome.

Depending on the market, that source could be an official government agency, sports governing body, election authority, or recognized news organization.

Once the resolution conditions are met, Signal settles the market according to those published rules.

If your position wins, your payout is credited to your Signal wallet.

The important part is that you know the rules before you trade. The resolution criteria aren't something you figure out after the event.

How to make your first prediction on Signal

Getting started is straightforward.

1. Sign in to Busha, or create an account if you're new to Busha.
2. Open the Signal web app and connect your Busha Account.
3. Authorize the connection, and your Signal account is created automatically.
4. Fund your Signal wallet from your Busha balance using Naira, stablecoins or other supported crypto.
5. Choose a market and read its resolution rules.
6. Pick YES or NO, decide how much you want to trade and place your position.

Your identity verification is handled through your existing Busha account, so there's no separate KYC process for Signal. If you're new to Busha, you'll also be able to complete a simple KYC process directly on Signal once that option is available.

The minimum deposit is ₦500, and funds typically arrive in your Signal wallet in less than 30 seconds.

Before trading, always read the market's resolution criteria and understand what determines the outcome.

Before the headline, there's a Signal

By the time a headline tells you what happened, the market has already been moving.

A prediction market gives you a different view: what people currently believe will happen next, expressed through a live price.

That price can change with the news, with new information and with the people trading it.

You don't have to be an economist, professional trader or sports analyst to participate. You just need a view, a market, and an understanding of the rules.

The question is no longer just "What do you think will happen?" 

It's "How strongly do you believe it, and what is that view worth?"

Explore the markets on Signal by Busha.

Want to stay in the loop? Join the Signal community and follow us on socials for new markets, market updates, and the conversations shaping what's next.