Polymarket paid US social media influencers for election content | Hacker News Reader

Polymarket paid US social media influencers for election content

bloomberg.com

84 pointsJumpCrisscross118 comments

It seems strange to me to call these "prediction markets" when we call them "betting exchanges" in the UK. It positions the goal of the market to make a prediction or a forecast, rather than simply being a bet. It's interesting framing.

yeah, i think they forget that they could also be a fairly direct hedge-market.

Invest as if A will happen. If the odds seem right, bet ~A will happen too.

if you believe in the wisdom of crowds, they are prediction markets. If you discount the wisdom of crowds, they are pure gambling.

I think they started being called prediction markets around the idea a few years back that we should allow "gambling" on events to predict events: if you allow betting on the date of the next terror attack, the terrorists will not be able to restrain themselves from insider trading, and bingo, you know when there will be a terror attack. The idea was that it was such a good idea, the FBI/CIA would run these things. But the public hated the idea so it got squelched.

This is all from my memory, which I wouldn't bet on.

> if you believe in the wisdom of crowds, they are prediction markets

With capped bets and broad participation, you have a wisdom of crowds game. That’s not how Polymarket is designed.

There's the problem that betting on assassinations or terror attacks is a deniable way of funding them. Because the perpetrator is the one who knows to bet on the correct date. One guy was prosecuted for proposing this, if I recall correctly

Oh yes, it was Jim Bell: https://en.m.wikipedia.org/wiki/Jim_Bell

Terrorists betting on their own attacks is not at all like voters betting on their own election. Wisdom of crowds is something I take with a grain of salt. But if there was ever a thing that crowds could predict, it is election results.

Archive link: https://archive.ph/ouJmu

Kalshi is hiring influencers as well: https://www.ycombinator.com/companies/kalshi/jobs/k3eFjQK-in...

I don’t see the issue?

I’m paywalled on the article but I think the issue is specifically with Polymarket hiring US influencers when they aren’t allowed to let Americans trade on the platform. Kalshi is allowed to let Americans trade so it’s not an issue (assuming they follow disclosure requirements etc.)

Considering that US influencers can reach the world, it's not a problem. I mean, if US persons are blocked from the platform anyway, why does it matter that the platform is advertised online?

Gambling is a regulated industry. Kalshi is licensed in the US, Polymarket isn't (but US consumers routinely use VPNs to evade their block). So the fact that they're clearly marketing to US consumers seems to be fraudulent evasion of oversight.

Are they advertising to US consumers, or simply to the world? I think it's just a global ad campaign. I haven't tried it but I assume that they can just reject any US payment method and be fine. How else would you pay, Bitcoin?

As long as it's good clean betting, I don't think anyone should be restricted from this gambling in the land of the "free" anyway. It's also weird that Kalshi is approved and Polymarket isn't. I wonder why that is the case.

It will be interesting to see how we feel about the prediction markets after today. They are making a clear bet on the winner, and if they are wrong, it will be a pretty big hit on their value.

It's just statistics. Even if it's 60/40 you could be wrong 4 out of 10 times.

This is true, but go ask Nate Silver how that went for him in 2016. The general public has only superficial familiarity with even basic statistics. 60/40 is perceived by many as a near guarantee. More than enough to make them cry 'stolen election!' if the election does not go the way they want.

Market dynamics are subtly different than statistics of traditional polls, since you need to account for fees and slippage and irrationality. You’d also need to compare this to a poll asking “who do you think will win the election?” which is a different question from “who are you voting for?”

"Subtly different"? It's not even remotely the same thing, all they have in common is that the unit is %. The betting probability is the (expected) chance that a certain candidate wins, while polls measure the % of population that votes for a candidate. A polling lead of 20% would seal the election.

PredictIt is at 53:52 currently, wouldn’t call this clear.

That's to mobilize people to vote who would otherwise stay home if the gap was bigger

That's interesting, I have only looked recently at polymarket, and it's at 62/38 right now. Robinhood is at 59/43. I wonder why PredictIt is so much closer.

Does predictit allow cash bets? seems like an arbitrage opportunity for a win-win bet.

I agree, although I read somewhere prediction markets in 2016 had Clinton by a wide margin. I don’t have a reference for that and obviously they would have been tiny markets by comparison to today.

If you have a coin and know for a fact that it is either a fair coin or a 60 40 coin, it would take ~100 flips to be 80% sure which kind of coin it is. We will never know whether polymarket’s odds were more accurate than e. g. Nate Silver’s on predicting a single event

Does it work like that? Wont the house set the odds such that it always win? I.e. the betters set the odds but the initial seed. The house know their book, we don't.

EDIT: Oh. Visiting the site, it seems like it is not gambling? Or have I misunderstood it.

It's definitely gambling (though maybe not legally, in some cases; RH is selling event contracts, and maybe derivatives are not legally gambling, but effectively they sure seem like it...). The payout is $1 if it turns out correct, $0 if not.

They had a huge miss in 2016 and it didn't seem to have a significant long term effect.

There is already plenty of historical data that would have demonstrated the quality of the predictions. This specific bet, however, could be the worst way to judge the prediction markets given that the key demographics of the gamblers, young risk taking males, are the same that strongly favor the GOP candidate. In that regard, your bet alone demonstrates loyalty which feels like a soft win. Also, when you win if you win, and if you lose, you were still right because you can cite the heavily skewed prediction market as proof the election was stolen.

But how is a prediction market any good if you need to correct for the demographics of the gamblers for each bet?

It being relevant to a couple bets doesn't mean you need to correct "each bet".

That depends on what you are using it for, doesn't it? Like anything, you cant turn your brain off and take it as gospel.

I absolutely hate the election betting markets. They seem so un-American. It was only made legal in the USA last month, so all of the results so far have been foreign entities.

Hate it.

FWIW, Polymarket is still technically not available from within the US, although since it’s crypto I imagine that’s not an insurmountable geoblock.

I've been using it from the UK where it's also technically not available and it's trivial to get around. You just have to turn on a vpn to click the bet button.

Polymarket was set up by Thiel to manipulate perception on election. Don't arbitrage it's overly high Trump prediction because he won't pay out for Kamala.

I do wonder what happens if they don't pay our. If it's not legal in the US, what's your recourse?

I believe it's all web3 smart contracts so they don't have the option to not pay out. They have an 'oracle' call the bets. Vitalik Buterin is an investor so I'm guessing the tech works.

You can actually get your money back at any point by selling in the market - I bailed on my Kamala bet when the results started coming in.

If you leave it to resolve it goes to the oracle which is a kind of voting mechanism https://docs.uma.xyz/protocol-overview/how-does-umas-oracle-...

Aside from gambling being iffy I'm quite impressed they've actually got the tech to work quite smoothly. There was talk of oracles and smart contracts for years and it never really worked much but this seems to be quite fast, cheap and secure.

Thats funny because I just saw an enormous video billboard ad for Polymarket in Philadelphia.

> betting

> un-American

Sports gambling itself was illegal in most of America until the Supreme Court decided Murphy v. NCAA in 2018.

The entirety of the legalized sports betting industry has emerged from essentially nothing and embedded itself thoroughly in the national sports psyche in the span of six years.

Nearly 1200 comments last month:

Legalizing sports gambling was a mistake

https://news.ycombinator.com/item?id=41659458

I feel so bad for kids growing up watching sports now. The beer commercials were bad enough, now kids are going to grow up to be gambling addicts too.

"Video Games", I mean, digital slot machines with a game on the side was doing this just fine before sports gambling was legalized.

Hell, even Lego is in on the Gacha action! Gambling is too profitable an endeavor to allow in a market economy. It only serves to snuff out all the oxygen for less scummy business.

I don't think lowering the profit margins of gambling would make the issue much better given the problems are in the externalities and non-rational acting of the gambler.

Outside of perhaps very "technically correct" and restrictive, like literally restricting people to nickle bets per game, in which case time would probably be the bottleneck to financial ruination (leaving only time-consumption life ruination) and probably would drive gambling underground.

That's already true in Australia, sadly.

The mob infamously exploited this widespread American tradition of sports gambling. The law merely legalized, not made it more or less American.

Yeah I find it funny when people equate "legal" to "normal" or "acceptable". The prohibition is one such large example.

I actually think we should ban polling, too. Make the election about getting the message out and convincing people, not about a horse race between two numbers.

Could be a good idea, but I suspect asking people what they think about political candidates enjoys such core first amendment protection that banning it would require amending the Constitution. And practically, nobody in power will want to ban them because they're a tool for staying in power. Same reason that we'll probably always have a two party system.

In a one-turn voting system, polls are very useful as a kind of "turn zero". The important point is that one should always tell the poller who they actually want to vote for (a possible third candidate) so that if this candidate actually stands a chance it can be seen in the poll and be voted for. In the actual election, if you see your third candidate has no chance you can vote for someone that can actually win.

Changing the voting system seems much more important than trying to mess with the polls. However, regulating polls to enforce their trustworthiness is probably a good idea since they may have so much power.

In France the presidential election is two-turns and even then I think we need polls since there are so many candidates in the first turn diluting votes.

The US is really a two-turn voting system. The first turn is the primaries.

It's quite different from the French presidential election, but the first round is open to all candidates. A non-aligned candidate would have to formally join a party to run for the nomination, but that's a matter of paperwork, not ideology. If they win office, they owe the party no obligations at all.

The French system may well be preferable, but the American system really does have more opportunities for non-aligned candidates than people realize. They tend to dismiss the primaries as unimportant, but they really are a first round of voting -- that's why they're called "primary". Anybody who wants influence can start there, rather than jumping straight into the general election.

Why not ranked choice?

I would love to have ranked choices as a voting system in France. It tends to promote moderate candidates but because it would change the outcome of elections so significantly it's probably almost impossible to set up (all parties that would lose from it would go all-in in opposing such a change).

> Make the election about getting the message out and convincing people, not about a horse race between two numbers

Polling helps elites and voters alike allocate resources. Biden was replaced in part due to polls. Similarly, if a race in my state becomes unexpectedly competitive, I’ll at attention more than I would have absent that signal.

Is that a good thing? The more you complicate the election process, particularly the more meta-information you add - such as predictions, polls, early results - the more it drives people to play silly meta-games, trying to "vote strategically", instead of just expressing their preferences.

I feel this violates some fundamental assumptions about the democratic process - when most people play the metagame, the result is no longer expressing real, object-level preferences of the people. At the very least, it encourages "us vs. them" thinking instead of focusing on improving lives.

> more you complicate the election process, particularly the more meta-information you add - such as predictions, polls, early results - the more it drives people to play silly meta-games

Agree with the former. Not the latter. Our elections are complicated because the process is complicated. To the degree I most appreciate polling, it's around things like ballot measures.

> when most people play the metagame, the result is no longer expressing real, object-level preferences of the people

In a democracy, yes. (One of the many reasons pure democracies don't work.) In a republic, consensus forming is fine.

If we only get to pick one thing, I'd much rather see us harmonize voting times between states so we don't have the election results rolling in before some people have voted.

https://en.wikipedia.org/wiki/Kalshi is a nyc company i believe

Here's a very interesting interview with the Kalshi founder to get his takes on many things people are talking about. https://youtu.be/atGcvlEO4qU

Stuff they talk about include:

- 90% male bias on Kalshi.

- Polymarket is all crypto so that probably introduces bias.

- He says 60/40 is still a coin flip.

- Prediction markets are just another sentiment tracker, that the 60/40 is still a coin flip race.

It's 100% American and has been a thing forever. It's also a free speech argument, I should be able to bet on outcomes of events. It was common all throughout US history

https://users.wfu.edu/strumpks/papers/Int_Election_Betting_F...

Fascinating, thanks for sharing! It should probably be highlighted tho that there were absolutely waves of relative interest (~1790-1840 and ~1890-1910, at least), and it was outlawed almost everywhere by the mid 1800s, which obviously means it primarily fell to the rich and well-connected. Ditto in Britain — they had bets, but;

  Bets about the outcome of events in war, over the death of political leaders, over court cases, or between voters over election results were illegal on these grounds. In the Victorian and Edwardian periods, the British government increasingly attempted to limit gambling, especially among the working classes.

So I’d argue it’s more like “a persistent scourge threatening democracy” than “a treasured ideal of free speech”. But I’m biased against all forms of gambling, so might have skimmed it unfairly. Worth a read, for sure!

There’s evidence that they have done, and currently do, a better job predicting election outcomes than polling.

Are you sure you don’t like them just because they are currently predicting the person that you don’t like is going to win the US election?

https://repository.arizona.edu/bitstream/handle/10150/666656...

https://www.sciencedirect.com/science/article/abs/pii/S02613...

Polymarket is a new thing and it's throwing a lot of political pundits off their tracks because they treat it as political sentiment indicator, but it's all just gambling and manipulation.

That’s the beauty of it. If you’re sure it’s wrong, you can profit off the gambling and manipulation.

You can also profit off regular gambling and manipulation by buying stocks in gambling companies.

Or really day trading in its entirety, IMHO. Imagine I had a casino game that all the best experts insist you have slim-to-no chance of beating the odds on, and that countless hordes of people just like you have lost their life savings on. Is it not gambling just because you have a system for picking a spot on the roulette wheel?

Not really. The house takes 2% of the winnings (current polymarket fee structure). You're betting against other people, not against the house. If you are correct and especially if you know something that other people don't know you may take a very large percentage of the pool. So this is a more "merit" based system when critical thinking and correct prediction pay well.

Every prediction market has a resolution date. Stock market does not. In that sense the prediction market "predicts" an external event on a particular date and this is the big difference. Stocks may rise of fall based on the perception of the market. A bet would get resolved based not on the perception of the people, but on the event itself. (or on the UMA dispute vote, but mostly the system is working).

That's why it doesn't matter how skewed/wrong a particular bet is (like Trump chances). If your think that the market is wrong, you get a better return on your money. And the resolution date + smart contract creates the possibility to earn if you are correct.

However, many stocks pay dividends at fixed intervals, based on objective metrics.

Even if I know that is bullshit if someone claims to know the next number of a roulette and backs it up going all-in on black, it is not rational for me to bet on red.

But if their having placed a bet makes your opposing bet cheaper, then it can! : )

At least one person has figured out how to beat roulette [0]. I’d follow his lead

[0] https://archive.ph/Hc0Kh

The thing about gambling is that even if you understand the nature of gambling it doesn't mean you can reliably win money from gambling.

Sure you can, especially if you’re rich! You just can’t reliably know when you can reliably win money ;)

Epistemology strikes yet again

It's not a random chance gambling like a casino. It's more like active stock trading. Many traders (especially retail) lose money, but many make money.

Polymarket is good when you understand the situation better than the people you're betting against. And the bet you're making can be on what you know.

My first 100 USDC I've made was when the CrowdStrike news hit. I saw a bet that it was a "hack". As a programmer I knew it wasn't a hack based on the technical information I read. The bet was 70 not a hack/30 hack. I bet that is was not a hack and got 30% return for 2 days.

Many people "bet" everyday. Every resource allocation decision is a bet. Polymarket is the same. Don't bet on "what will Trump say" or "the price of BTC in a week", but there a plenty of bets where you can make a reasonable prediction and get consistent returns.

> It's more like active stock trading.

That is also random chance gambling.

If it was, than people like Buffet, Stan Druckenmiller or Jim Simmons wouldn't exist.

They are trading and they are making bets. Simmons makes milions of them everyday :), Buffet makes 1 per month. But they are active stock traders not a passive index investors.

Well, not Jim Simons. He’s dead.

Does that matter, he managed to be living for the last 30 years creating a consistently earning quant trading fund.

There are thousands of Buffets, Stans, and Jims that don't exist.

The point is that you don't see a Buffet like figure earning consistently in random-bet casino games. If you see that there are some examples disproving the conjecture "Market is fully random and are not different than a casino roulette game". It may be uncommon, but not a fully random example.

You are skeptical of this idea because you expect to see more people like Buffet "making money by simply buying stocks" (I'm being reductive for the sake of writing, not arguing). The unspoken foundation for this assumption is that everyone is equally at the casino roulette game. That is not the case. The american wealth inequality is vast. You are seeing exactly the expected number of winners (few) given that the people at the table who can afford a majority of the loss are very few.

Stock markets are a casino gamble and the few people like Buffet are actually proof of it being a gamble.

Don't take my word for it: https://money.com/warren-buffett-stock-market-casino/#:~:tex...

There are lots of shades of random. When the three-photon photoelectric effect will happen is random, but if you can find a way to bet against it, unless the odds are ridiculously skewed, you should.

But the odds are ridiculously skewed - that's how it works. They're skewed so the house always wins, which means the customers, taken together, always lose. If everyone's betting against the three-photon photoelectric effect, you will be able to multiply your money by precisely 1.0 when your bet comes true and it doesn't happen, or maybe even 0.999.

The house here is just taking some money off the top. It doesn't really matter whether the customers, taken together, get 100% or 98% of their money back. What matters is that an individual that's a few percent more accurate than the market can make money.

It depends on what you mean by reliably. There's always short term variance, often a lot of it, but a player with an edge will absolutely win reliably in the long run.

There are ways to reliably make money off of it, for example via arbitrage. There have been moments when you could by different candidate bets on different platforms and profit no matter what.

Except the people who know best are in the US and can't file 1099 on their winnings without implicitly admitting to a crime. Any American dumb enough to invest in Polymarket deserves to lose their money.

Any fed dumb enough to waste tax dollars chasing down the client side of the usual small stakes token 2-4 figure betting this involves rather than polymarket (et al) directly deserves to be fired, since it almost certainly is a net negative to the taxpayer and will do nothing to stop this kind of betting.

This country is rule by law, the laws regularly broken will be weaponized for political purposes.

> If you’re sure it’s wrong, you can profit off the gambling and manipulation

Not if you’re American and want to respect the law!

Right, but I'm also ethically opposed to the industry

Statistically speaking, I'd expect some hardcore sample bias, if using Polymarket to model the US population.

The biggest bettor is French, apparently:

https://www.reuters.com/world/polymarket-says-mystery-trump-...

That guy bet $46m. Current betting volume is $3.3bn.

So, that's true. But the point of the linked article is that Polymarket is clearly marketing to US consumers, a market it isn't licensed to serve and that it claims it tries to prevent (via an IP block, anyway).

It's not illegal to be running a gambling and manipulation site per se. PredictIt and Kalshi do it above board. Polymarket appears to be engaging in at least a little bit of fraud here.

For me personally, I placed a bet for my non-favored candidate so that either my person wins, or I win some amount of money. I'm using it kind of like insurance or hedging. Unfortunately if enough people use it this way, it probably no longer works as a predictor

I thought about doing this as well but ended up viewing it personally as a "lose-lose" for myself rather than a "win-win". I wonder if that says anything about my risk-aversion.

It means you are not a degenerate gambler. You probably also do not enjoy slot machines, or the bullshit that passes for card games in a casino. I want to play blackjack, not "blackjack" where you change the allowed bets and rules specifically to increase the house edge thank you very much.

Do you feel the same way about insurance in general?

Betting markets can be good predictors but I think what poly market is reflective of is not people who are looking for the optimal bet; but wish casting of crypto bros.

It does seem to be working a bit as a sentiment indicator at the moment on the Trump Kamala election but seems biased because most people speculating on crypto are male and pro Trump. In basic economic theory you'd expect it to reflect a realistic estimate of the candidates chances but seems off a little just now. I'm long Kamala for what it's worth.

Ah well, that didn't quite work out.

Is polymarket even legal in the US? I tried to sign up a while ago and it wouldn't allow me to fund my account

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