Just game-theoretically, suppose you bet $100 on some disaster.

That disaster causes $10,000,000 of harm, but only causes you $90 of harm individually.

You've gained $10, but your $10 gain is a millionth of the harm caused.

Generally-speaking, there's an enormous asymmetry between the cost to create/build and the cost to destroy. So now we have a mechanism by which individuals have a financial incentive to cause harm...

Don't these markets create a mechanism for society to race to self-destruction?

▲

HWR_14 5 hours ago | parent | next [-]

Search for "assassination markets", which is a longish treatment of this idea. Specifically, people collectively can bet large sums of money that X will not be killed Thursday at 5pm. And anyone can take the other side at insanely good odds...

▲

pants2 5 hours ago | parent | prev | next [-]

Couldn't that be said of stock markets and any markets?

United Healthcare stock dropped 10% immediately after its CEO was killed.

▲

cowpig 4 hours ago | parent | next [-]

Well, there are laws against insider trading.

	▲	kqr 4 hours ago \| parent \| next [-]
		Is shorting a company and then murdering its CEO considered insider trading in your jurisdiction?
	▲	mcmcmc 4 hours ago \| parent \| prev \| next [-]
		Prediction markets advertise insider trading as a feature, and enforcement of financial crimes is a racket anyway. If you know the right people, make the right campaign contributions, laws just don't apply to you.
	▲	ant6n 4 hours ago \| parent \| prev [-]
		Wait, is the shooter in “insider” in this case?

▲

pixl97 3 hours ago | parent | prev [-]

Yes, and sounds like a great way to get RICO conspiracy to commit murder added to your charges just for trading on it.

▲

Jblx2 5 hours ago | parent | prev | next [-]

How is that different from regular old insurance?

	▲	cowpig 4 hours ago \| parent [-]
		Insurance is usually for things that primarily affect the purchaser?

▲

Chris2048 4 hours ago | parent | prev [-]

How does someone with a mere $10 stake have the opportunity to contribute to the cause of a $10mil disaster?

Realistically, they'd have to be far more connected to the event, and as such, far more exposed to some kind of risk.

	▲	haritha-j 4 hours ago \| parent [-]
		Pessimistically, i imagine that's what they meant by "enormous asymmetry between the cost to create/build and the cost to destroy". Like its a lot easier to destroy an art piece in a museum than to create one.