The thing is you're still thinking of these insiders as someone who just got a juicy stock tip from a relative.

The much more serious problem is when these insiders actually have their hands on the levers which decide the outcome. It's really no different than a mobster who bets a bunch on money on an unlikely outcome then threatens one side to throw the match.

What possible economic benefit is there to society to allow ordinary people to bet in markets like that?

Would you really like to live in a world where "Will we nuke Iran?" Is a bet you can make? Then someone in government sees how much money they could make if they bet yes & push the button?

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tgsovlerkhgsel 2 hours ago | parent [-]

This is the entire idea behind the concept of "assassination markets" - "prediction" markets on assassinations that are just thinly veiled ways to crowdsource murders by taking bets that you expect to lose against an "insider" (the killer).

	▲	parpfish 41 minutes ago \| parent \| next [-]
		It doesn’t need to be as high stakes as assassination. Any public figure could have a free-money loophole with all the stupid bets on things like whether a certain word would appear in a speech. If I were famous I could start a pool betting on whether I would post a picture of a my lunch this week. I could stake whichever side has the biggest payout and then just make it happen
	▲	jacksnipe 19 minutes ago \| parent \| prev [-]
		Futures contracts were a mistake, god damn