Yes, and let me add that that's by design. Prediction markets' main function is to incentivize people with private information to make it public.

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jmcgough 2 hours ago | parent | next [-]

By this logic, wouldn't prediction markets be a national security threat?

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tasuki 24 minutes ago | parent | next [-]

Yes, I suppose. Remember people are parts of various nations. Your "national security threat" might be a "national security opportunity" for someone else ;)

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bathtub365 2 hours ago | parent | prev [-]

Sure, but look at who controls the national security apparatus in the US at the moment.

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k33n an hour ago | parent [-]

A duly elected President, as it’s always been.

	▲	analognoise an hour ago \| parent [-]
		Who should have never been allowed to run, both for his felony criminal conviction, his plot to tamper with the election, and of course the assault on the capitol. This is before we even add on the Epstein stuff, or his latest war. It’s pretty clear Trump is a threat and everyone in his orbit needs to end up in prison.

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globular-toast 2 hours ago | parent | prev | next [-]

We get it but what good is it if the insiders come and bet mere hours before the event happens? So we could have known a few hours early? I feel like this is just people trying to justify gambling. In the UK bookies have been doing this forever, it's nothing new. It's just gambling.

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mint5 2 hours ago | parent | prev [-]

How does making a wager cause insider info to be public? All it means is an anonymous account placed money on the outcome, how does it make public anything that an insider knows? It doesn’t.

It incentives them to keep the info secret in order to profit or a wager on a related outcome. The insider info remains secret, all people know is some bloke stood up a new account and placed a big bet.

And for these short timespan bets, it seems utterly useless. If the wagers were only allowed on things two weeks out, and not allow bets on short term events then maybe it could show more info.

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nl 2 hours ago | parent [-]

The price movement is the indicator that there is insider information.

Of course there are lots of problems with this theory - in large markets a single trader has to make large bets to move the market, and with the current leadership the price moves large amounts unpredictably as well based on the latest statements.

But the mechanism itself makes sense.

It's unclear if that's a good thing. Of course some people know secret information before hand. Is disclosing that always good?

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arter45 an hour ago | parent [-]

Another problem is, people may actually want to bet on random outcomes, because of money laundering or simply because this is how gambling essentially works. That huge account could be an insider or a billionaire with a few hundreds k to burn. Or maybe they want to orient people’s opinions towards a certain outcome.

Claiming that price movement in a prediction market reveals some amount of truth implicitly assumes that:

- people bet on something they believe to be true, and not to sway other people’s opinions or simply to burn money,

- people bet on something they believe to be true because they have specific private information (e.g. I bet on the Red Sox not because I think they’re good but because I know things other don’t about their opponents, their physical conditions and so on).

- their belief is actually correct (eg if I’m in the CIA and I know that the Soviets are about to launch a nuclear missile I can bet on it… but I don’t know that an officer down the line will refuse to do that).

Even if this was true, there is an issue of timing and consequences. Example: imagine it’s 2011 and some CIA or DoD officer makes huge, sudden bets on the fact that Bin Laden will be caught. Some AQ people get wind of this and move Bin Laden somewhere else. Congrats, your price movement signaled non public information to the market!

Another issue is that these bets tend to rely on public sources, news reports and so on. A journalist in Israel was threatened to change his news reports so that certain people didn’t have to lose on a prediction market. This could become more and more common, and with the advent of AI generated pictures who are you going to believe? Are you losing money because you bet on the wrong outcome or simply because someone with enough resources ensured that your outcome was never going to be reported?

	▲	chii an hour ago \| parent [-]
		> Congrats, your price movement signaled non public information to the market! so from bin laden's perspective, this would've been a good outcome isnt it? Can't say what a good outcome is without saying who. What if enemies of the USA had corrupt generals who also make bets on anti-US actions to profit personally, and inadvertently reveal information to the CIA/NSA, who then prevent such anti-US actions? Would that not have been a good outcome as well? Information is information - and one cannot say if it's good or not. However, i am a believer that more information generally do good than bad - assuming the consumer of said information is smart. > Are you losing money because you bet on the wrong outcome ... It doesnt matter, because you chose to bet. You do not need to bet in order to make use of the information being revealed by those who are betting.