alt Hacker NewsJust 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?
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Couldn't that be said of stock markets and any markets?
United Healthcare stock dropped 10% immediately after its CEO was killed.
How does someone with a mere $10 stake have the opportunity to contribute to the cause of a $10mil disaster?
Realistically, they'd have to be far more connected to the event, and as such, far more exposed to some kind of risk.
Search for "assassination markets", which is a longish treatment of this idea. Specifically, people collectively can bet large sums of money that X will not be killed Thursday at 5pm. And anyone can take the other side at insanely good odds...