Prediction markets are breaking the news and becoming their own beat

ggnabgib about 8 hours ago 50 commentsRead Article on niemanlab.org

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Discussion (50 Comments)Read Original on HackerNews

throwaway0665•about 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.

puelocesar•about 1 hour 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

4gotunameagain•27 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...

OJFord•about 2 hours 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.)

throwaway0665•about 1 hour ago

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

OJFord•10 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.

arowthway•about 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.

Quarrelsome•about 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.

mr_mitm•42 minutes ago

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

philipallstar•about 1 hour ago

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

neonstatic•about 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.

Quarrelsome•28 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.

dzhiurgis•about 2 hours ago

Journalists are most likely to profit from this too

nicbou•about 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.

yen223•about 3 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.

Terr_•about 3 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/

DonHopkins•about 2 hours ago

Luigi, let’s-a go!!!

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

bluecalm•about 2 hours ago

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

yorwba•about 2 hours ago

Yes, that's why insider trading is illegal.

cromka•about 1 hour ago

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

DonHopkins•about 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...

sznio•about 3 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.

CTDOCodebases•about 3 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.

jstanley•about 2 hours ago

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

Ray20•about 2 hours 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

jcattle•27 minutes ago

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

wodenokoto•about 3 hours ago

> The gamblers don't seem to care.

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

amwet•about 3 hours ago

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

Quarrelsome•about 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.

jessegeens•about 2 hours ago

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

xnx•about 2 hours ago

How would money laundering work with a prediction market?

seydor•about 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

seydor•about 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'

podgorniy•about 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....

shafyy•about 1 hour ago

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

ares623•about 4 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.

Terr_•about 2 hours 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.

ares623•about 2 hours 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.

seydor•about 1 hour ago

> democratizing insider trading

Those are contradictory words

sixhobbits•about 4 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

topspin•about 3 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.

Havoc•about 2 hours 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

shafyy•about 1 hour ago

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

DonHopkins•about 3 hours ago

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

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

camillomiller•about 2 hours 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?