I don't know how you extrapolated that from the parent's comment. It literally said nothing about the cause and effect of this particular event.
Knowing the odds in a prediction market IS a big part of the problem brought up in the linked article though (and the bets themselves). Knowing how much can be made from being right creates an upper-bound on what a financially-rational malicious actor will spend in trying to change the outcome.
What does "here" mean? It's logical to expect "here" to refer to a scenario that includes cases like the one in the article. If it's some scenario that excludes cases like the one in the article, then it's not actually relevant to the discussion.
(Tangents are OK. It's just confusing if they're introduced with phrasing that makes them sound like they're not tangents.)
I wasn't extrapolating - it was the literal meaning of the words. The context was that someone commented "shouldn't be called prediction markets, they should be called outcome-shaping markets" in direct reply to "Polymarket gamblers threaten to kill me over…[the prediction market "Iran strikes Israel on March 10"]. I interpret that as polymarket gamblers outcome-shaped Iran striking Israel. It was at 25% odds when they struck. I don't think the commenter actually meant that literally, which is why I asked them to clarify. I'm just doing my best here.
I think the point is more that if it's already happening at this level of adoption, and these are only the ones we know about, surely there are many more where this is happening and we don't know, and as adoption increases, it will get worse and worse since the liquidity on the line will be much higher.
Elections, wars, the economy, healthcare systems, laws, court cases?
The example you provided does look like some insider trading type of stuff, just like how 1v1 professional sports players will sometimes intentionally lose after receiving a bribe to do so, but both your example and sports don't really seem to have any kind of meaningful impact on anything or anyone who isn't gambling, no?
In situations like this, where you wouldn't expect to see evidence of something even if it were happening, you're basically left to make a judgement based on prior probability. So here that would come down to: is the financial incentive provided by the prediction market high enough relative to the decisionmaker's perceived risk and penalty of being caught? IMO, the answer is currently 'no' for most high-profile cases, but in a future where more money is riding on the bets, or where decisionmakers are insulated from consequences, that could swing to 'yes'.
This applies to governance as well. Note how there was a bet placed on polymarket on maduros capture mere hours before the raid were conducted, and this has lead to legislation moving forward in effort to combat suspicious prediction market activity based on whitehouse insider knowledge.
https://ritchietorres.house.gov/posts/in-response-to-suspici...
"Iran strikes Israel on March 10" is a difficult outcome to force one way or the other. But "The Times of Israel’s military correspondent or other credible sources reports that Iran strikes Israel on March 10" merely requires intimidating or bribing one journalist. The existence of the bet didn't cause the missile strike or the failed interception. But it did cause a significant, heavily motivated dis-information campaign from people who stood to lose a lot of money.
In a similar way, people fear that prediction markets estimating times of death are equivalent to assassination markets. But murder is an aggressively prosecuted serious crime. It seems that it would be far easier and lower risk to bribe, coerce, pretend to be, or literally be a reporter who got a false obituary published - wait until the "victim" is going to be offline for a few days and can't be contacted to prove they're not dead, trick some tropical country's coast guard into confirming that the victim's yacht exploded offshore, point Polymarket at the obituaries, grab all the crypto, and disappear. If you fail to disappear successfully, your worst crime is publishing a fictional news article/bribing/threatening a journalist. You don't have to risk being in the legal jurisdiction of the victim and getting your hands bloody, you don't even have to be in the same hemisphere: you only need convince the prediction market resolution criteria that something happened.
Scott Alexander wrote about a related issue last month in the colorfully named section [1] "Annals of the Rulescucks", where he described a half dozen scenarios where the outcome may or may not have diverged from the actual event. A bet isn't resolved by eyewitnesses, it's resolved over the Internet through another financial instrument.
[1]: https://www.astralcodexten.com/i/184065379/annals-of-the-rul...
You don't even need the market to actually resolve, as soon as your rumor becomes credible the market pricing will adjust and you can just sell your shares before resolution.
"Hey there's this newspaper that says this obscure thing happened, please resolve the bet in my favour"