So, a fun historical fact is that insurance markets started with people in coffee houses betting on whether or not ships would sink for fun. Eventually ship owners realized that if they bet on their own ship sinking, that it reduced the financial risk of travel, then betters realized that ship owners were doing that and decided to research before taking the other side of the bet, and so on until you end up with ship insurance.

In a sense, prediction markets are all forms of insurance. A "war market" is just an insurance market against war. If you do business in someplace that is at risk at war, placing a huge bet on the war happening mitigates the risk of doing business in that place.

There is a reason that insurance has taken the shape that it has -- incredibly detailed contracts, requirements that the insured have an interest in the thing being insured, etc, and the reason is exactly that pure prediction markets went through this exact cycle hundreds of years ago which lead to laws being passed banning the practice. That is why LLoyd's of London exists. It started as a pure gambling and became insurance through regulation and business evolution.

https://en.wikipedia.org/wiki/Marine_Insurance_Act_1745 https://en.wikipedia.org/wiki/Life_Assurance_Act_1774

I'm not incredibly against the concept of prediction markets, per se, but running them _globally, _at scale_ with _no regulations_ is going to lead to really awful outcomes, up to and including murder.