We thought betting markets would bring out our best predictions. Instead they’re exposing our inherent corruption.
It's hard to measure what anyone actually believes in the current social landscape, where nobody tells the truth. Maybe that's the real purpose of prediction markets.
[0] https://en.wikipedia.org/wiki/Wisdom_of_the_crowd
Edit:
Actually, turns out "people claiming" includes Polymarket lol
# What is Polymarket
...
Our markets reflect accurate, unbiased, and real-time probabilities for the events that matter most to you. Markets seek truth.
# How accurate are Polymarket odds?
Research shows prediction markets are often more accurate than experts, polls, and pundits. .... Their economic incentives ensure market prices adjust to reflect true odds as more knowledgeable participants join.
This makes prediction markets the best source of real-time event probabilities. People use Polymarket for the most accurate odds, gaining the ability to make informed decisions about the future.
https://help.polymarket.com/en/articles/13364060-what-is-pol...
> one ultimate ending where everything is done for the betting
It really does seem that gambling has this sinister power to cannibalize whatever is being gambled upon, twisting it and transforming it into whatever maximizes the ability for market-makers to generate profit, sharps to extract alpha, and addicts to get their hit of dopamine.
Looks like “we” need to update our relationships with markets
Price discovery is a visualization of the collective conscious, and the evolution of markets gets closer and closer to direct exposure to an event. Share and derisk a transaction, cleanly, quickly
Reduce all frictions towards doing so
Frictions include finding the person making the transaction, negotiating with them, trusting them to perform, disputing resolution, insurance. These hamper anything from occurring, or occurring quickly, and the pricing is too variable. Prediction markets are an example of all of those frictions being reduced to almost non-existent. And dispute resolution will improve further and attract more liquidity.
crypto anarchist papers described prediction markets to be used for something like this in the 90s, but there are several levels of infrastructure that didn't exist then
if you are predicting such things are occurring then you could also buy the no shares, making it the most egalitarian social mobility opportunity out there. I think the focus on bribery and corruption is distracting because people are imagining exclusion, but its the opposite at this point.
Imagine when the soviet union fell and only people that built relationships got dibs on all the assets and revenue streams to become "the oligarchs" almost overnight, but instead of only them, everyone paying attention could take part in it. That's what is happening now and the markets will continue existing autonomously
What's the incentive of betting if you're not an insider? You're better off putting you money on a fair coin toss, instead of hoping you'll somehow beat an openly rigged market.
How much have you yourself made in these sorts of markets?
People don't play in corrupt markets for very long.
To corrupt a sport bet, there needs to be an actual manipulation of events perpetrated by a very small, very closely watched and analyzed group of people (athletes or officials).
In my view, it seems immediately obvious that as prediction markets become even more mainstream (and so the billboard effect gets stronger), Polymarket bets will have a significantly higher rate of corruption than sports bets.
Information about a players wellbeing and their life goes a long way. Example, they would pay paper boys to talk to coaches to find out non public information. Such as if a player of the team is going through relationship problems.
It's a classic though for sure
Every important event in the world has dozens if not hundreds of people "in the know" before it happens. Not everyone has paper boys, chatty coaches, or the time/energy required to connect all those dots.
The entire flow insider information is reversed from "go out and look for it" to "invite it in anonymously"
Forget it jake, it's Polymarket.
As the billboard glow inviting insiders to trade gets brighter, the markets get less useful, less fun, less interesting, and obviously less rewarding.
The point is for business with vested interests (and therefore often inside information) to use these markets to hedge for things that will materially affect their profitability.
For example, in this case, suppose you ran a company that was shipping goods through the Middle East, and a war would disrupt your business. You would then place bets on there being a war, so that if it does happen you will recover some of your losses. You might know inside information because your work in the region, but that is expected.
No, the best way to win on Polymarket is purely by insider trading. Which is why it's a useful thing to watch. Insider news..
That said, the definition of 'insider trading' is always tricky. At what point does it become insider? Some things people call insider others just call clever detective work.
So how useful is it really to see a big bet and know that probably the thing in question will happen in the next hour?
The only kind of use case I can see for these markets is what another commenter mentioned, as a kind of strange insurance by betting against what you hope will happen. But even then, the finicky rules and untrustworthiness of the Polymarket admins make them much less reliable than a traditional insurance policy...
That maybe true in a normal world, but we left normalcy in this world a couple of administrations ago. I absolutely would not put it past a member of this admin to be keeping an eye on things like this to suggest it would be better to start the attack on specific day just to pad the coffers. Any other admin, and I'd say that would be an insane line of thought, but it is this admin.
I dont think I was special or unusual.
I think it's pretty obvious when betting on events that are inherently just decisions by one or a few people (e.g. when will Trump launch an attack on Iran, when will a company launch a new product, will some company acquire another one, etc.) that they will attract insider trading and corruption by their very nature - all that's necessary is to have information about the decision maker. This is fundamentally different than events that are subject to forces that no single individual controls - e.g. who will win an election, where will a crypto price be in a year, movie box office results, etc.
I think betting on "single decision maker" events is just a "sucker is born every minute"-type bet.
Notice how the bettor hedged and bet on multiple days and hedged each of their bets with a "by" clause. This is a bog standard hedging strategy that anyone who's been to a racetrack would know.
On a separate note, gamified prediction markets should not exist - they create perverse incentives and are basically a gamification of futures contracts (which requires a degree of risk management and hedging experience the median individual simply lacks), but this specific example doesn't seem like insider trading, just a seasoned gambler who knows basic hedging strategy.
If you don't like prediction markets, you don't have to use them.
Why do you think other people shouldn't be allowed to use prediction markets if they want to?
In aggregate, most participants lack the background and experience needed to hedge against risk and bet intelligently.
Gamifying a financial instrument (futures) that is supposed to be used as an risk management device and advertising it to the lowest common denominator without providing the right checks and balances will leave a large portion of bettors worse off.
Heck, I'm decently good at blackjack, poker, and backgammon because it's fun to apply probability theory principles, but I would never dare put my personal money on such an investment when I would do significantly better in aggregate with other more diversified personal investments.
2. It encourages the leaking of classified information.
You should not be able to get rich to the tune of a 600% daily return just because you're insider trading. That doesn't incentivize sharing your information with the market. On the contrary that incentivizes delaying communicating your secret information until the last second to maximize the return on your unexpected information.
why can't it be both? you think degenerate gamblers have never had a government job?
Using a public betting platform with KYC vetting is not that.
Betting a strike would be on Friday also tracks - anyone who's been outside the West knows they have Friday/Saturday off in Muslim and Jewish countries. It's the same way we in the West tend to conduct strikes on Saturday.
Edit: Ah I get what you are saying now.
Some insider selling changes the prediction downwards
The WANT the information