Bets of Bitcoin is a prediction market. It's a site where bets are made towards the outcome of future events. The winners will get their wagers back plus earn the wagers from those who lost (less a small commission paid to the site operators).
Anyone can create a bet statement. Bets range from who will win a certain election to what the price of gold will be at the end of the month. The difference between Bets of Bitcoin and other prediction markets, such as Intrade and Betfair, is that Bets of Bitcoin is completely anonymous. To place a bet you deposit bitcoins and you get paid in bitcoins if you win.