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Comment by akelly | Hacker News Reader

This is a huge blow to political discourse. PredictIt has been operating since 2014 with the approval of the CFTC as the largest election betting platform in the US. Today they received notice from the CFTC instructing them to cease operations by February 15th without clear justification for the decision.

One year ago, YC backed betting market Kalshi launched with CFTC approval. They employ a former commissioner of the CFTC as Chief Regulatory Officer, and two weeks ago applied for CFTC approval to have election markets. And half a year ago, the popular unapproved blockchain betting market Polymarket was fined and shut down in the US by the CFTC.

Further reading:

https://twitter.com/NathanpmYoung/status/1555387422510264321

https://www.cftc.gov/csl/22-08/download

https://astralcodexten.substack.com/p/the-passage-of-polymar...

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In term of political discourse it is/was a good source to verify the validity of some of the more up voted stuff on HN. One top comment a few years ago predicted that the US would abolish election and be a monarchy by 2020. An other that there would be a full scale nuclear third world war in 2019. There were one saying that the US would enter a new civil war by 2021. In each case I checked betting sites to see if such views held enough popular support, but alas I could not find any to bet against.

If people who hold conspiracy theories put down money and lost, maybe that would do more to change how people think than any political debate ever could.

As far as I can tell from hanging out on Predictit for years, it's actually pretty shit at predicting things. That some event isn't something that you can gamble on, or that a particular outcome of an event isn't an option until five minutes before it actually happens, doesn't tell you anything.

> If people who hold conspiracy theories put down money and lost

If people who say that the government claim on X is true had to put money behind it, we'd see a massive wealth transfer from smirking status quo guys to little groups of conspiracy theorists. Half the time (like for example the missile strike on that family of saints as we left Afghanistan), the government line has been disproved before the press release even gets out; easy money.

edit: if anything, Predictit acts as a summary of current media coverage/sentiment.

If you spent time on predictit you would know the conspiracy people aren't rational and lose all their money. They bet in ways that reflect their disjointed understanding of the world.

Not understanding the odds of their bets in general, and getting wrecked on stupid, improbable maga bets about Hillary getting locked up.

Conspiracy people tend to be ultra partisan and believe things with no real evidence beyond they want these things to be true. That doesn't work when they start betting actual money.

There was tons of money to be made long after the 2020 election on whether or not trump would magically become president again.

Out of curiosity, how many "conspiracy people" do you have exposure to/hang out with?

I have made well over 10k betting against them in absurd bets where the odds of trump becoming president months after the election were estimated by them to be much higher than any rational person would think them to be.

I also spend a decent amount of time looking at qanon websites/forums/reading their insane chatter on twitter.

What do you think the odds of Biden being a body double clone are? Many of them think the odds of this are well over 50%.

> edit: if anything, Predictit acts as a summary of current media coverage/sentiment.

This is exactly it; you have some small percentage of people "putting their money where their mouth is" but most of it is people trying to second guess and game everyone else (you could reliably make money trading shares on the news cycle, for example).

Although it doesn't make sense to have prediction markets for truly catasclymic events -- anyone who believes nuclear war is imminent is gonna prefer to buy canned food over prediction market contracts.

Problem with your idea (which is conceptually valid) is that you can buy and sell on Predictit well before the closure of the "market/event". So many people who agreed with a politician or idea (that some event would happen) would still sell early (at 90c/1$) because they could use those funds in other markets.

Worse still - you have people who would pump & dump the market - pushing the contra position (Trump wins 2020) and post comments showing showing holdings supporting contra, and then dump after it gains a significant share. I've heard of some predictit users doing this same operation 5x or more on a single market (an iconic example: Iowa Dem Primary 2020).

So it's all speculation.

Not sure this is good veracity of truth. Most people also predicted Hillary Clinton would win. Given the nature of over/under there is incentives to bet on the incorrect side knowingly

Do you have a source on Kalshi applying to list election contracts?

In general, I agree, looks like regulatory capture by Kalshi.

https://kalshi-public-docs.s3.amazonaws.com/regulatory/notic...

I also have strong suspicions this is related to Kalshi somehow

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