Glossary term
Settlement (Prediction Markets)
The payout phase after a contract resolves; settlement can lag the underlying event by days or weeks.
Settlement is the phase in which a resolved prediction-market contract is paid out and capital is returned to holders. It can lag the underlying event by days or weeks, especially where resolution depends on official confirmation or is disputed. This settlement lag ties up capital and is an often-overlooked cost in calculating the true return on a prediction-market position. See Prediction Market Risk 101.