alt Hacker NewsWe haven't seen the worst of what gambling and prediction markets will do
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'Predictions' market is the silliest loophole for gambling. Honestly, more surprised Fanduel, DraftKings and the like who have spent millions on lobbying and buying licenses, are not fighting tooth and nail on this.
These prediction markets shouldn't be allowed for situations where humans can control the outcome.
They do have their place however - one I find particularly interesting is weather prediction markets, primary because they end up having a net benefit. Hundreds are creating their own weather prediction models and are duking it out. Over time these models get better, and the rest of us benefit.
I think these markets could be a net good, but right now they're just enabling insider trading on a scale we've never seen before.
"where key decision makers in government have the tantalizing options to make hundreds of thousands of dollars by synchronizing military engagements with their gambling position"
To wit: where key decision makers in government can get paid to reveal war secretes to our enemies.
> And now here come the prediction markets, such as Polymarket and Kalshi, whose combined 2025 revenue came in around $50 billion.
Bizarre to call trading volume "revenue". Last year, trading fees for Kalshi amounted to about $263 million[0], whereas Polymarket largely did not have fees in 2025 and is turning them on in a few days[1].
[0]: https://finance.yahoo.com/news/kalshi-fee-revenue-2025-263-1...
[1]: https://thedefiant.io/news/defi/polymarket-begins-rolling-ou...
Why do we need to reinvent the wheel again. There's a reason why these things are banned.
And by the way, shame on all the podcasters and VCs who advertised those abominable 'platforms'. To name one, the cast of the All-in podcast
If you wager in a prediction market, isn't it expected that there will be some insider trading or thrown results? Because there are clearly people who know when and where bombs will land, and financial incentive to throw results.
Thus it makes sense to not participate at all, unless YOU are the one doing the cheating.
Assuming everything physical gets tokenized (as occasionally gets predicted), people could soon literally lose their house on a bet! Maybe even a bet placed by their swarm of agents. The future's so bright, I gotta wear shades!
Americans may be shocked to hear that in the rest of the world gambling has been a thing for centuries.
We also have people under the age of 20 drinking alcohol.
I am not suggesting in any way that gambling is good - but it wasnt invented last week in america
Here's an alleged secondary effect of 2 in a quote by Polymarket founder Shayne Coplan[1]:
“When I get hit up by people in the Middle East who are saying, ‘Hey, we’re looking at Polymarket to decide whether we sleep near the bomb shelter; we look at it every day’ and I’m like, ‘Oh, it’s really that popular over there?’” he added. “That’s very powerful. That’s an undeniable value proposition that did not exist before.”
I'm with Matt Levine here[2]:
"There is something particularly dystopian about the idea that:
a) Some countries will bomb other countries.
b) The people doing the bombing will profit from the bombing by insider trading the bombing contracts on prediction markets.
c) This will cause the prediction markets to correctly reflect the probability of bombing, allowing the people getting bombed to avoid being bombed."
[1] https://www.bloomberg.com/news/articles/2026-03-07/polymarke... [2] https://www.bloomberg.com/opinion/newsletters/2026-03-12/lev...
How much of this is fixed if a person is only able to bet token amounts on each outcome? Let's get crazy and make it $20. A few crazy people might run Sybil attacks but it'll be a lot more limited and obvious. Not that I'm opposed to consigning all these gambling apps back to the fiery depths from which they came, but if you do want to preserve the ability of healthy people to have a little bit of fun, limiting the bet size has almost no effect on that while drastically reducing the damage. It seems like a good compromise, if anyone is looking for one of those.
Gambling is flourishing not because we're in a low-trust world, as the article says, but because the living conditions of an increasingly large part of the population as such that they cannot hope of ever achieving a comfortable life. We're returning to the social dynamics that dominated much of history (if you consider how much gambling was a scourge, from ancient Rome to thousands of years of history in China).
Hardcore gamblers' tendency to lash out at athletes, when bets go wrong, can get really scary. This is Point No. 2 in Thompson's analysis -- and it deserves a closer look. From what I've seen, the level of threats, abuse, etc. is just horrifying. The 30x increase in money bet, sadly, seems to be translating into a 30x increase in betters' hostile conduct.
I was reminded of this bizarre article: https://www.si.com/betting/2023/09/15/fake-indian-cricket-le...
It's tough, because I think outlawing 'vices' like gambling is an infringement on your individual freedom - but when it's done with an enterprise it's so much more problematic. Thinking about for instance tobacco companies vs locally grown in the backyard.
The problem is that these markets allow to translate political power directly to money. Worse destructive events are rare, need a lot less action (butterfly effect) and leave thus less traces and command high odds. Once committed the ones in power have a vested interest in causing destruction.
Just game-theoretically, suppose you bet $100 on some disaster.
That disaster causes $10,000,000 of harm, but only causes you $90 of harm individually.
You've gained $10, but your $10 gain is a millionth of the harm caused.
Generally-speaking, there's an enormous asymmetry between the cost to create/build and the cost to destroy. So now we have a mechanism by which individuals have a financial incentive to cause harm...
Don't these markets create a mechanism for society to race to self-destruction?
Wait, people can bet on bombings now? What the hell man.
The real power in prediction markets is creating a market for what you want to occur - it's a tangible method to leverage hyperstition.
If you want Polymarket to no longer exist, then simply create a pool for "Polymarket will no longer exist by Jan 1st 2027" on Kalshi, pump the price, and wait for one of these whales to do the job of making it come true for you. When done right, you get the satisfaction of the thing happening, and all of the ROI for entering on the ground floor.
Rinse and repeat and you no longer have to sit by the sidelines and view world events as things that unfold without your input. You can be an active participant in making history the way you want it.
I got into weather betting markets earlier this year since I figured those can't possibly be rigged, it is automated weather station data yet some groups in the market know the truth a few minutes before everyone else based on the way the markets move.
BUT, I stopped on the day that the PHL airport preliminary report said the low of the day was 17 and then later than day the low was raised to 18. The way the market was behaving, insiders knew the low would be retracted because normally the markets clear out a tranche of bets that are no longer possible and that wasn't happening that day.
So I don't do that. The whole game seems to be based on a group of insiders that know when and what temperature reports will say seconds or minutes before the general public and they have the capacity to play with validation on the back-end (I suspect).
I built a few models to predict weather 6+ hours out using blended model forecast data, but that didn't do better than break-even.
I don't know my point. It is the wild west, caveat emptor, you need thick skin and ridiculous attention to detail to beat the game, and even then the deck is probably stacked against you.
The amount of suspicious bets around international politics is disturbing
One data point of many: https://www.cnn.com/2026/03/24/politics/iran-war-bets-predic...
Fact: Donald Trump Jump Jr is an advisor of polymarket
Gambling may be bad on its own, but the gambling and advertising combo are a very harmful combination IMHO.
Obligatory: The Policy Analysis Market (PAM), part of the FutureMAP project, was a proposed futures exchange developed, beginning in May 2001, by the Information Awareness Office (IAO) of the United States Defense Advanced Research Projects Agency (DARPA), and based on an idea first proposed by Net Exchange, a San Diego, California, research firm specializing in the development of online prediction markets. PAM was shut down in August 2003 after multiple US senators condemned it as an assassination and terrorism market, a characterization criticized in turn by futures-exchange expert Robin Hanson of George Mason University, and several journalists.[1]
The big issue underlying gambling, betting, alcohol, tobacco, and other addictive stuff all the way to fentanyl, is that people may literally lose their mind over it, at least party. A heavy addict ceases to be a responsible adult who can act reasonably and autonomously, and becomes driven by impulses they cannot control, like a schizophrenic who cannot control the voices in their head.
Even more unpleasantly, this does not happen to everyone every time. Quite many people can have a glass of wine here and there without becoming alcoholics. A ton of people can play a game like Bejeweled out of boredom, and happily switch to more interesting activities, given a chance. Some people can voluntarily stop even taking heroin and subject themselves to therapy. Etc, etc.
But a relatively small minority gets hooked badly. They cannot quit. They do not want to stop. The addiction becomes a primary life activity. Many more who could be hooked to physiologically brutal addictions like nicotine or heroin are wise enough to never approach those, understanding how badly it might end. But again, a relative minority cannot resist the lure.
A less tolerant society would stigmatize such outcomes, adding strong social pressure that might keep potential addicts from getting into the habit. A society could also consider addiction a medical condition that requires intervention and treatment, like poisoning or a dangerous infection. Even modern Western societies are capable of that when sufficiently frightened, see COVID-19.
Another approach, which I'd call "extremist libertarian", would just let addictions form, proclaiming that this is what people do exercising their free will. It would not be different from a complete lack of civilization, and leaving the problem to the evolution to solve. In either case the addicts would suffer, in worst cases going destitute and die. That would remove the addicts from the gene pool, probably lowering the risk of addiction in future generations, slowly. Slowly, and painfully, often not only to addicts but also to people around them.
We struggle with addressing addictions because we struggle to admit that addictions exist, and that in bad cases they affect the sufferer's agency quite a bit. I'm afraid that without admitting this property of heavy addiction we won't be able to act in an efficacious way.
Sounds like good ol' fashioned developing country style corruption to me!
Anti-intellectualism 1, liberal democratic values 0.
All this fearmongering about decision markets lately is really annoying. If you don't like gambling — just don't gamble and shut the fuck up. It's not for you to decide if gambling is good or bad for me. If I am stupid enough to bet anything on an outcome that clearly depends on a person who could, potentially, be betting as well — it's my problem, not yours.
Today Integrity is merely means to score more views and likes
That’s how far we have fallen. We are all painfully aware how corrupted all sorts of people are but instead of actual action we give each other likes on social media under carefully crafted anger bait.
So much everything online is fake that it is tempting to just throw your phone away.
The genuineness is the highest luxury
I try to make sure to get truly downvoted to hell every other week on social media. It resets the addicted brain and stops hive mind progress bar for a little while at least. Also get banned - this is good for you too precisely because it feels slightly uncomfortable.
That’s how I try to survive online landscapes anyway.
Inventive markets is a better term for what they will become.
Americans coming to the realisation that much of the rest of the world came to decades ago and acting like it’s a massive revelation is…absolutely par for the course for the US. Just hurry up and implode already.
I've always said we should just legalize insider trading. Just make it painfully obvious to everyone that speculative trading is the loser's game.
Let's make a bet on how bad it can get
I can place a bet that by 2027 we will have 1 bet and a payout on a bet that predicts a horrible catastrophe.
I agree that this is bad but the libertarian in me says "the market will resolve this because who in their right mind would be a counterparty to these bets knowing that there is so much insider trading?". But then again, many people are not in their right mind.
This is what "AGI" will bring more of. An "abundance" of gamblers.
Maybe we should build a prediction model of upcoming events based on volume of bets made on polymarket
Maybe it would be better to ban Las Vegas.
Correct me if I'm wrong, but can't you also craft an Etherium contract to do the same thing as these prediction markets. So even without a company "framing all the markets" you could still have gambling based on base eth?
Do you even need prediction markets if the department of war can just make the real markets do whatever the hell they want?
I like prediction markets because they offer much more diverse markets compared to stocks/options and sports betting, which are far more limited. The downsides are limited liquidity and fraud, but this is endemic to other markets too.
An argument not mentioned here and which I didn’t appreciate until I actually took part in these markets myself, is that you need a supply of stupid/uninformed people to take the other side of the informed people’s bets.(In economic terms, no-trade theorems apply.) That suggests to me that the dream of perfect information revelation isn’t going to come true. Instead, the liquid markets will be those with a large supply of marks, who bet for identity reasons or who are simply ignorant and naive. (Currently polymarket gives a 16% ish probability that Trump will lose office this year. Sounds like wishful thinking to me?)
Prediction market creators making the case that their existing is some sort of a market efficiency play is the most laughable thing I have ever heard.
SC made a mistake in the Draft King/Fan duel saga and has unleashed the worst kind of market, takes up may too much money and time especially from young people.
Attaching payouts to events skews the incentives. A baseball player gets the incentive to fuck up on purpose. Fortunately politicians are much more honest and would never make a decision to profit from a bet in a similar dishonest way.
Well corporate stocks have the same dynamic. People are banding together and manipulating reality in unproductive ways to make their stocks go up.
Countries literally go to war so that weapon dealers can sell weapons and banks can later sell loans to rebuild the country.
The real problem is centralization of power.
Within the horrible context of the current situation, it's a good thing that at least there is a force to drive outcomes that seem random as opposed to just being around money. It democratizes the horrors a bit so that rich people who have money and live in corporate stock lala land can get a slight taste of the negatives of large-scale vested interests collaborating towards dystopian outcomes.
That said, a better solution would be to shut down all public markets and companies.
My view is that if a company is so well recognized that government officials can reference it by name in congress, then that company should be shut down automatically. We know it didn't get there by economic efficiency... It almost certainly got there by voting and sociopolitical manipulation.
You can't shut down betting markets without shutting down the public stock markets because they are betting markets themselves.
While many of us try to stay true as possible to be Libertarian when we say we are, this, like smoking in public, are not hills I’m willing to die on if someone decides to restrict.
Assassinations markets are what's next.
eg. someone will bet $1M that Elon Musk will be assassinated in 2026.
But these don't themselves even have to be legal. Second order wagers will be placed on SpaceX and Tesla stock prices, bets that "a hundred billionaire will die in 2026", etc.
A bet that Putin will be assassinated could be encoded in, "there will be regime change in Russia."
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> Two-thirds of Americans now believe that professional athletes sometimes change their performance to influence gambling outcomes.
I'm not sure this is a bad thing. It's just bringing to public visibility exactly what happens across the stock market. Public companies do this all the time -- engineer their performance end earnings to influence <strike>shareholder</strike> gambler expectations on earnings day.
The craziest thing here is that online gambling has been legal in the UK and Ireland for many years, and it's been such an obvious negative for those countries — and had been optimized brutally like any other tech product. When I moved over to the US a decade ago, I remember thinking 'well at least they're smart enough to have banned online gambling'.
I am very pro personal liberties, but this stuff is weaponized to prey on a subset of humanity. I'm in senior leadership, and have made it clear that anyone who has worked on these products should not be hired.