alt Hacker NewsPeople keep saying they provide the market with information, and that's the benefit of allowing the insider trading, but no one has pointed out how in any way society has benefitted from the insider trading instances so far...
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It's useful for things like elections, where though popular media might push one line of thought primarily, the markets will adjust to be closer to the reality. Pretty visible in the 2024 elections where if you followed mainstream media at all, you probably wouldn't realize the markets had Trump at a 60% chance to win just before the election.
But for so many things, there's just too many sources of insider info. Reality television especially, the last couple seasons of Survivor have been clearly leaked if you look at a prediction market. And since all of production knows, and obviously all the players know, someone tells their family members, and all of a sudden you have a few hundred people who know for sure who will win.
The answer is pretty obvious, right? It doesn’t reliably deliver on that promise, and in the meantime they rake billions on unregulated gambling with near zero institutional exposure.