A market that prices the future
A prediction market is a market where what's being traded isn't a company's stock or a commodity, it's a contract tied to whether a specific real-world event happens. Will a particular candidate win an election. Will a project ship its mainnet by a certain date. Will a central bank raise rates at its next meeting. Each of these can be turned into a contract that pays out a fixed amount if the event happens and nothing if it doesn't.
Because the contract's payout depends entirely on the outcome, its price naturally settles somewhere between those two extremes while the outcome is still uncertain. A contract that pays out 1 dollar if an event happens and trades at 70 cents is, in effect, being priced by the market at roughly a 70 percent chance of that event occurring. The price isn't a prediction someone wrote down, it's the equilibrium point where buyers and sellers with different beliefs agree to trade.