Prediction markets are breaking the news and becoming their own beat

Posted by gnabgib 7 hours ago

Counter40Comment50OpenOriginal

Comments

Comment by throwaway0665 3 hours ago

These apps claim to let you turn your knowledge into money. What this means is the insiders get to cash out and the desperate suckers provide the liquidity. I'm amazed they've all gotten away with this for so long.

Comment by puelocesar 59 minutes ago

They get away with it by having on the payroll the son of the president of the most powerful (and dangerous) country in the world

Comment by 4gotunameagain 23 minutes ago

And one of the most corrupt presidents, I might add. He has increased his wealth by at least $3 BILLION during this last term.

https://www.forbes.com/sites/danalexander/2025/09/09/preside...

Comment by OJFord 1 hour ago

They've 'gotten away with' it by for example winning cases deciding they offer commodities trading, not gambling. (You can disagree with it, it's in the open and explicit is my point.)

Comment by throwaway0665 43 minutes ago

They've had people in their corner who've overturned state law. There are federal lawsuits in progress.

Comment by OJFord 7 minutes ago

I have no horse in this race, that's sort of exactly my point - they haven't mysteriously 'gotten away with' it like done something illegal and nobody noticed; there have been cases, there will be more, it's so far been allowed. I don't call that 'getting away with' is all.

Comment by arowthway 3 hours ago

I don't understand, what's so fundamentally wrong with this form of insider trading? Is the accusation that it makes degenerate gambling unfair? Is it necessary for degenerate gambling to be fair? The gamblers don't seem to care.

Comment by Quarrelsome 2 hours ago

because the long term outcome is that truth will start to be defined by money. There's already been tales of journalists being harassed to change stories in order for over-leveraged betters to win polymarket bets.

I HIGHLY recommend going onto a sports subreddit match thread during a match and seeing what people say, versus the post match thread, a few hours after the match. The difference in tone is striking. While some people are probably just passionate, I'm pretty sure the depths of vitriol (that border on things like death threats) are a consequence of gambling.

Comment by mr_mitm 39 minutes ago

That's a fundamental problem with prediction markets, not the insider aspect of it.

Comment by philipallstar 1 hour ago

Death threats are so common online that the selective reporting of them is weaponisation.

Comment by neonstatic 1 hour ago

> truth will start to be defined by money

I'm a firm believer in 'there's nothing new under the sun'.

> There's already been tales of journalists being harassed to change stories in order for over-leveraged betters to win polymarket bets.

So the only thing that has changed is who is doing the harassing.

> I'm pretty sure the depths of vitriol (that border on things like death threats) are a consequence of gambling.

People who are "passionate" about sports have always been the most aggressive and vulgar. I grew up around them, this does not surprise me at all.

Comment by Quarrelsome 24 minutes ago

> People who are "passionate" about sports have always been the most aggressive and vulgar.

Sure but I can't help but wonder if many of them have money riding on the games which makes their anger much more understandable. Perhaps those you grew up around were also having a bit of a flutter.

Comment by neonstatic 15 minutes ago

Oh, for sure, I don't doubt that at all! My only point is causality. I do not agree that it's betting companies fault (whether they are on-chain or not). If there weren't ways to bet, these people would invent them.

Comment by dzhiurgis 1 hour ago

Journalists are most likely to profit from this too

Comment by nicbou 1 hour ago

If there is enough money on the table, gambles can influence real world events.

Can you guarantee a fair trial when anyone can bet on the outcome, including the judge and the defense?

It has changed the outcome of some sports matches. It could change the outcome of far more important events.

Comment by yen223 2 hours ago

Matt Levine pointed out in a past article that the real danger of insider trading are company insiders being incentivised to damage the company to make a quick buck.

Comment by Terr_ 2 hours ago

> insiders being incentivised to damage the company

I'd like to emphasize that this incentive doesn't have to be an accidental find by the insider either: The "market" can end up facilitating anonymous crowd-sourced bribery by enemies or competitors, who create the potential for profit knowing that eventually an insider will take the other end of the implied deal.

Every time I see someone dismissing these kinds of issues--especially someone whose salary depends on not-understanding it [0] --I imagine how their tune would change if the shoe was on the other foot. For example, if someone created a "prediction market" where people could anonymously bet on unusual deaths or serious injuries of... prediction-market executives.

[0] https://quoteinvestigator.com/2017/11/30/salary/

Comment by DonHopkins 2 hours ago

Luigi, let’s-a go!!!

https://www.youtube.com/shorts/TvWbOKJvZmk

Comment by bluecalm 2 hours ago

How is it different than shorting or buying put options and then damaging the company? The tools are already there.

Comment by yorwba 2 hours ago

Yes, that's why insider trading is illegal.

Comment by cromka 1 hour ago

The difference is one is illegal, the other one is not.

Comment by collabs 56 minutes ago

Maybe there should be a maximum betting limit the same way there should be an election contribution limit — let's say something like 10x the federal minimum wage or whatever so if you are betting under USD 75.5, it is A ok but once you cross this number, we require public disclosures, no hiding behind LLC, natural persons only, KYC, the whole shebang.

Actually, now that I think about it, let's get rid of the minimum, there should be no minimum, all bets even five cents must be fully disclosed and attributed to natural persons, no hiding behind "corporations are people, my friend" nonsense.

Comment by somenameforme 34 minutes ago

Artificially influencing a stock's price is illegal by itself, and there's probably about a half dozen other charges that could be tacked in this scheme, possibly including extremely serious ones like wire fraud which gets tacked on pretty much every crime involving digital tech.

Comment by DonHopkins 2 hours ago

What other GTA missions and Mossad operations should we democratize with a small personal computerized device?

https://youtu.be/RmUQptXfiWs?t=485

https://en.wikipedia.org/wiki/2024_Lebanon_electronic_device...

Comment by sznio 2 hours ago

beyond the general idea that we shouldn't normalize gambling, betting on some real-life events is horrid. think about insider trading on a polymarket bet for someone's death.

Comment by CTDOCodebases 2 hours ago

Or even worse what happens when people start gambling that someone won’t die today? It opens the door to crowdsourced hits with plausible deniability.

Comment by jstanley 2 hours ago

You missed out the reason that it's horrid, which is that it is a plausibly-deniable way to crowdfund assassinations.

Comment by Ray20 1 hour ago

So, the typical "It's only okay when the elites do it." Although, it's almost certain that such crowdfunding practices will lead to a radical democratization of society as a whole.

Today, any bloody dictator, tyrant, or autocrat continues to kill people en masse simply because society lacks a sufficiently effective tool to guarantee the reliable transfer of funds to one of their henchmen should the issue with him be effectively resolved

Comment by jstanley 49 minutes ago

I don't know how you got that from what I said.

EDIT: Oh, I initially thought that you thought that I was saying that it's OK for the government to coordinate assassinations but not OK for other people to coordinate assassinations. Which is not what I said, I only said (implied) that it's not OK for other people to coordinate assassinations. I made no representation regarding whether I think it's OK for the government to coordinate assassinations.

However, what I now think you're saying is that assassination markets would lead to fewer assassinations rather than more, because... if ordinary people could trade in assassination markets then they would choose to assassinate the government's assassins, and then the government would not react or respond in any way, so then the government would no longer be able to coordinate assassinations, and the general public would stop using the assassination market, and then the problem is solved. Is that right?

Comment by jcattle 24 minutes ago

There's a difference between insider trading and gambling no?

Comment by wodenokoto 2 hours ago

> The gamblers don't seem to care.

Which makes me wonder if it is actually just money laundering.

Comment by amwet 2 hours ago

The obvious counter example is lotteries. People just like to gamble.

Comment by Quarrelsome 2 hours ago

people like hope. In Dickens era the hope was that you'd discover you were a long lost bastard child of some wealthy aristocratic family. These days, its that you win the lottery.

We shouldn't conflate permitting lotteries which give a lot of people precious hope, with enabling the disease of gambling addiction. Gambling addiction transforms its victims into desperate degenerate messes, who will do anything in order to reverse the outcome of their losses. By popularising gambling on reality (instead of a sandbox like sport) we're creating a future where such people will harass journalists, which further threatens our increasingly precarious relationship with truth.

Comment by jessegeens 2 hours ago

Well, you can also use normal lotteries for money laundering: https://www.ftm.eu/articles/reynders-charged-in-money-launde...

Comment by yorwba 2 hours ago

Because there's pre-existing demand for lottery tickets that provides some plausible deniability for the money-laundering use case. If prediction markets were primarily used to buy insurance against hard-to-avoid expensive events, that's what money launderers would trade in too, in order to blend in.

Instead, most volume is in sports bets. People just like to gamble.

Comment by xnx 1 hour ago

How would money laundering work with a prediction market?

Comment by seydor 1 hour ago

But this is not insider trading, beause the insider event IS affected by the behavior of the gamblers. Normally the insider event should be uncorrelated and unknown to the gamblers

Comment by seydor 1 hour ago

Just Goodhart's law to massive scale, the most predictable thing ever (there should be a bet for that). Please go back to crypto and destroy this abhorrent 'industry'

Comment by podgorniy 1 hour ago

Buying future becomes even easier: just poor money into a bet and eveyone will discuss it as it's real people's expectations....

Comment by shafyy 1 hour ago

I recommend watching the latest Last Week Tonight about prediction markets: https://www.youtube.com/watch?v=ZN4njIQcSR4

Comment by ares623 3 hours ago

I dunno, I feel it's just democratizing insider trading. And as everyone knows, if it has "democratizing" in it, that means it's automatically good.

Comment by Terr_ 1 hour ago

In a way, it's even worse. (Yes, I know the post is sardonic, I mean it's even worse than that.)

Many of these things are not really democratized either, they're centralized systems with a "we empower you" sales-pitch. The opaque and unaccountable central authority has an incentive to pick-and-choose what's possible, and to put their thumb on the metaphorical scales to get certain outcomes.

Kind of like ride-share apps: Any pretense of "democratizing" jobs faded, instead they enabled new flavors of monopolistic exploitation.

Comment by ares623 1 hour ago

It's funny, after posting the above message I started thinking what else can be made to sound "good" just by prepending it with "democratizing". Surprisingly it works really well.

Comment by seydor 1 hour ago

> democratizing insider trading

Those are contradictory words

Comment by sixhobbits 3 hours ago

I (my agents) have been playing with the kalshi and poly market APIsv and whatever your opinion on the markets themselves it does feel like there's a bunch of interesting things to do with such a firehose of realtime data.

I hope they stay as open and generous as they are now with programmatic access

Comment by topspin 2 hours ago

"I hope they stay as open and generous as they are now with programmatic access"

Make a prediction for it: When will Gamma/Data/CLOB require subscription: 2026, 2027, etc.

Comment by Havoc 1 hour ago

> it blows my mind that we haven’t seen anyone arrested for insider trading yet,

Almost like the offenders get their inside info straight from the chief purveyor of markets up and down chaos

Comment by shafyy 1 hour ago

Donald Trump Jr. is an adviser to both Kalshi and Polymarket, and an investor in one of them (forgot which one).

Comment by DonHopkins 2 hours ago

I didn't bet on the beat this broke on.

https://youtu.be/ZN4njIQcSR4?t=1815

Comment by camillomiller 1 hour ago

There is a market to bet whether Bryan Johnson will have sex this month or not. I dunno, seems that would be easy to control if you are, I dunno, the living person involved?