Watch Prediction Markets Are Here. Save Your Money For Watches.

On March 3rd, 2026, prediction market platform Kalshi and pre-owned watch marketplace Bezel launched Watch Futures—contracts letting you bet on outcomes like whether Rolex will discontinue the GMT-Master II 'Pepsi', release a new collection this year, or whether the price of a specific reference will rise or fall over a given month. When I saw this yesterday, I didn't like the sound of it. I saw friends and colleagues share similar sentiments online. Today, I like it even less as I think through how these markets stand to exploit the average watch enthusiast. My advice? Save your money for watches.

I'll be upfront: I've written multiple pieces of sponsored content for Bezel, most recently in September of 2024. I've interviewed their CEO Quaid Walker. I've interviewed Ryan Chong, their head of authentication, who runs one of the most rigorous watch authentication operations in the pre-owned market. I would recommend Bezel for buying a pre-owned modern watch, but today's topic is quite different. I do not have an ongoing relationship with Bezel, this is not sponsored by anybody, and what follows is my honest opinion.

First, What Are Prediction Markets?

A prediction market is a platform where you can buy and sell shares on the outcome of just about anything. The most popular category is sports—prediction market platforms like Kalshi evade state gambling laws, advertising "100% legal sports trading to all 50 states." You can bet on election outcomes, tomorrow's weather in Alaska, and now, the price performance of individual Rolex models.

James Surowiecki's The Wisdom of Crowds makes the argument that aggregated collective intelligence, under the right conditions, can be more accurate than any individual expert. Prediction markets are sort of the financial expression of that idea. Some would argue the purpose of a prediction market is to provide information—to accurately predict an outcome.

The Fundamental Flaw

A bet is not fair when one party already knows the outcome. This is why insider trading is illegal—those with non-public information cannot leverage it to make money on the stock market. Prediction markets aren't regulated in the same way, so "insider trading" isn't enforced in the same way, and in fact, it’s often celebrated. After all, it's "providing information" to accurately predict an outcome.

To be clear, Kalshi's official policy does prohibit insider trading—they conduct identity checks and report suspicious activity to the CFTC. But enforcement in prediction markets is nascent at best. There is no established regulatory framework defining insider trading in this context, and the decentralized nature of these platforms makes systematic enforcement extremely difficult.

Take Kalshi's market on whether or not Rolex will discontinue the Steel Pepsi GMT this year, currently sitting at an 85% chance (that number was as low as 16.8% yesterday; the overall average hovers around 70%). Whether Rolex is discontinuing the Pepsi isn't a mystery inside Rolex's Geneva headquarters. Thousands of people already know: employees at various levels, authorized dealers who've been briefed, and increasingly, journalists. Last year Rolex gave media outlets embargoed access for the first time. If that continues, the circle of people who know the answers to questions being actively traded on Kalshi will only grow.

I'm not accusing anyone of anything. But the mechanism to profit off insider knowledge is sitting right there on a mobile app. Bezel CEO Quaid Walker essentially acknowledged the dynamic himself in an interview with All Things Fashion Tech—noting that "if [a user] had some knowledge that a watch was going to get discontinued, then [that user] would, theoretically, emphatically place a trade that it would… which would slowly start to reveal that truth to the rest of the market." By the logic of prediction markets, that's a feature. In the context of a market built on watch industry knowledge that is not equally distributed, it's exploitative.

I published an article arguing the Pepsi was on its way out yesterday—before I even knew this market existed. We've covered Rolex's manufacturing issues with the blue-and-red 'Pepsi' ceramic insert and the model's potential for discontinuation for years. Those articles now appear in Google's AI overview when someone searches "is Rolex discontinuing the Pepsi GMT?"—which is to say, they're the same articles a Kalshi trader might read before placing a bet. Questions like "Will Rolex release a new collection this year?" (21% chance) or "Will Rolex release a reference in titanium?" (36% chance) are things I look forward to writing about and debating with enthusiasts this time of year. Now, that same speculation also exists as a series of bettable markets—traded by those same enthusiasts, and potentially by people with a clear view of the answer.

What makes this more interesting—and more concerning—is that these aren't just binary hold-to-expiration bets. You can trade in and out of positions before the outcome is resolved, just like a stock. Buy "yes" on the Pepsi discontinuation at 16.8%, watch the market move to 80% as information spreads, sell your position before Rolex pulls the model in April. That is, if there are even enough bids to sell your position at the market’s current valuation. Low volumes make for low liquidity, but it’s still early days.

Further Concerns

The pricing-based contracts on these markets are powered by Bezel's "Beztimate" valuation engine, which pulls from their own marketplace data—verified sales, live listings, bids and offers. Beztimate uses "multiple valuation models" with the goal of producing a truly representative market price. Private trades and wholesale transactions, where much of the watch market's actual volume lives, typically sit below public listing prices—and Beztimate attempts to account for that. Bezel's annual reports show they have a substantial amount of transaction data to draw from. But it is, by definition, incomplete. The Beztimate is an algorithmic estimate of a market that is only partially visible, and when a trading market is governed by a private valuation tool, questions around methodology and bias are legitimate ones to ask.

The insider knowledge problem applies most obviously to the binary outcome markets—discontinuations, new releases, that sort of thing. But the price direction contracts carry their own risk. Consider a dealer who has accumulated a significant position in a particular reference—say, a stockpile of Submariner Date 'Starbucks' models. That dealer could place a "down" bet on the Starbucks price index for a given month, then flood the secondary market with their inventory, artificially driving prices down and validating their own trade. Anyone who watched gray market premiums spike and collapse over the last five years knows that concentrated inventory can move watch prices.

Image Source: The Marin Vault

Most trades I'm seeing on Watch Futures are under $300, many under $50—again, early days. The markets went live March 2nd, and total volume on a single contract sits no higher than $11,403 as of publishing. Today, you can completely manipulate these markets with less than $1,000.

A Word on Kalshi

Kalshi's entire business model exists in a legal gray area—one that multiple U.S. states have challenged. The 19 pending federal lawsuits fall into three categories: six "offensive" suits where Kalshi has sued regulators in states like New York, Michigan, and Illinois; eight "defensive" suits launched by state gaming commissions and tribal entities alleging Kalshi is operating as an unlicensed sportsbook; and five consumer-led class actions focused on gambling addiction. The core argument from states is simple: regardless of how Kalshi labels its products, they function like betting platforms and should require compliance with state gaming laws. Kalshi disagrees, and the courts have been split.

Where This Goes

These markets are two days old. Volumes are low. Volatility is high, which is completely expected at this stage. Over time, as more money enters, these markets should theoretically stabilize and become more accurate predictors—that's how prediction markets are supposed to work.

But let's be honest about who stands to benefit most from that process—and who doesn't. The people best positioned to profit from Watch Futures are those who already know the answers: dealers with advance knowledge of supply shifts, brand insiders with a heads-up on discontinuations, anyone sitting on information about what's coming out of Geneva in April before the rest of the market knows. The people most likely to be on the other side of those trades are enthusiasts: people who follow the watch world closely, have strong opinions, and want to put a dollar behind them.

To some extent, the watch market has always involved information asymmetry, insider knowledge, and the occasional well-positioned dealer who knows something before the rest of us do. Attaching a liquid trading market to that ecosystem doesn't necessarily change those dynamics. It just gives them a new venue.