Prediction markets as a useful tool are predicated on insider information. The punters without edge are the bait incentivizing the insiders.

And in the US prediction markets are regulated like commodities which have much more lax insider rules, because again, insider trading is the point.

Yeah there are all those stupid things like "what color of Gatorade will they pour over players at the end of the game" that are ultimately about some arbitrary decision an individual or small group. Probably a whole sports game is fair to bet on because it involves so many sub-events but people gamble on things that make no sense to be gambling on.

If some specific prediction market can easily be manipulated by someone with insider knowledge, you better should not gamble in it.

> Unlike in sports/stocks there are no rules / punishment for insider trading.

Wouldn’t the good old-fashioned fraud laws present in basically every jurisdiction apply?

Even in stock trading you can get away with it for a long time. See Epstein.

The stock market and the sports market are also honeypots .

I have a bridge to sell you in Brooklyn if you believe that when you bet on the stock market or on the sports market for each and every particular bet involving millions of people the maximum profit is not reaped by a half a dozen of insiders who trade on inside informations and their only problem is not being too obvious about it.

Also even if they get caught the millions of people wagering are still getting fucked because there is not a redo or making people whole when the insider traders get caught (which is a tiny percentage of the time)