Who Wins and Who Loses in Prediction Markets? Evidence from Polymarket

Re:Who Wins and Who Loses in Prediction Markets? Evidence fr... by tsimionescu on Thursday May 21, 2026 @12:44PM (#48225629)

There are some bets on prediction markets where the future is either already known or in the control of people who may be participating in the market. For example, when people bet on how long the next presidential briefing will be, it doesn't take a prophet to predict this, anyone who organizes said briefing can control it (at least with a very high probability).

So, the question becomes "what is the preponderence of such bets" and "how many people with control or knowledge of bet outcomes actually participate in the market" - not "can some people see the future of any bet better than others".

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Re:Who Wins and Who Loses in Prediction Markets? Evidence fr... by locallost on Thursday May 21, 2026 @02:53PM (#48227380)

This still doesn't mean they are good at it. For them it's like flipping a coin with two identical sides. It's just cheating.

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Re:Who Wins and Who Loses in Prediction Markets? Evidence fr... by tsimionescu on Friday May 22, 2026 @04:20AM (#48233319)

My point was that the alternative to "liquidity providers make the most money" is not "prophets exist", the truth could have been "insiders make the most money".

Note that there is nothing in the rules of Polymarket or the other prediction markets that says it's not perfectly OK for insiders to bet, so I don't think it makes sense to call this cheating. Of course, this is a major absurdity of these "markets", but insiders are part of the game you chose to play by participating.

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Re:Who Wins and Who Loses in Prediction Markets? Evidence fr... by locallost on Saturday May 23, 2026 @05:32PM (#48251754)

There could be many alternatives, but not valid. Polymarket and Kalshi have banned insider betting.

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