The total open interest of all major prediction markets is barely over a billion dollars. (1) That's the total amount of money currently wagered on ALL contracts across all platforms.

There are roughly 2,500 individual companies listed in the US alone with a market cap that exceeds 1 billion dollars. Tesla's market cap is 1.4 trillion - about 1,000 times the size of all prediction markets put together.

In other words, to the extent this incentive is of societal concern, it is not because of prediction markets - that is the tail wagging the dog.

Edit: to be clear I think these markets are a scourge as they currently operate, but not for this reason.

(1) https://predik.io/en/blog/open-interest-mercados-prediccion-...