Is it polymarket presenting this ability to detect insiders? Or is someone trying to sell the service of detecting insiders to those wanting to know if bets are on equal footing? (or wanting to follow insiders? or wanting to hide your identity by making multiple accounts? Are there per-account fees, when polymarket might encourage people to make multiple accounts?)
Regardless, polymarket seems to be on balance corrupting, by monetizing and normalizing use of inside information, which violates agency principles. It's not clear that it really offers hedging or predictive benefits.
When trading firms do better (after data discovery and analysis), there's some evidence they're better than other firms, and you can trust them with some money. But when there's a public prediction market, the only benefit is to the insiders.
This is talking about using Compound AI (product I'm working on) to query Polymarket data, including finding insiders, just as a fun example analysis you could do.
Often you need a well-calibrated probability of a future event to feed into some other analysis, and Polymarket is pretty great for that. An example is how much insurance (hedge) to buy for some disastrous event.
This is a common take on "inside information", but for most people this opinion is totally unaligned with their own goals. The people who benefit from "no insider trading" in any market, are a small group of active traders, some institutional, some not.
For literally everyone else, insider trading is a net win. Insider trading improves price discovery. If you passively invest then you benefit from the price being more accurate when whatever fraction of your paycheck goes into the market.
I don't know your own situation, maybe you are one of those few traders who needs information to spread a certain way in order to make money. For everyone else, don't be fooled into promoting an idea against your own interests.
Clearly the people who benefit from insider trading in any market are those doing the insider trading, not all market participants.
The argument is not that Polymarket et al are "insider trading only" but rather that insider trading in those markets is not regulated so people can get ahead of trades based on confidential information and make a lot of money off of all the suckers gambling their money away on ridiculously frivolous bets.
If you don't see the problem with that, you're complicit, misinformed or brainwashed.
A similar issue is that of market manipulation, since many markets in these platforms can be directly manipulated by participants in manners as easily as spamming some words on an earnings call.
The more accurate the markets get, the greater the incentive for insiders to spoil it.
That doesn’t benefit anyone but the insider and probably has a net negative on everyone else.
false.
all the conclusions economists draw in microeconomic theory about efficient markets are based on pricing that reflects symmetric information. secrets are asymmetric. trading on inside information drives the market price in the direction it should be moving, making the market more efficient, a benefit to all participants in the market.
this is not a defense of trading on inside information, simply pointing out the mechanics.
That sounds like "insider trading" machines, or "scam" machines, rather than truth machines.
Although, sometimes a market provides incentive to publish information that's associated with the market being influenced. For example, someone can do an investigation, short the stock, then publish it.
This mirrors a core flaw in Polymarket: profit maximization is not truth-seeking. Just as Persian bribes manipulated ancient morale, modern "whales" can distort market odds to manufacture narratives or hedge external interests. In both cases, the prediction is a commodity sold to the highest bidder rather than an objective forecast of reality.
like if 50 ppl vote A, 45 people vote B and 1 person who actually knows their shit votes B?
How do you find it? By amount?
Some have better models that predict with higher accuracy, given the same data.
I bought one lottery ticket, I don't think my odds are gonna get any better than that.
Some might even say Dirac like but I so NO, this simply does not go far enough.
I will remember this moment for the remainder of my life. Thank you.
Seems more like a hobby activity than a decision that would lead to any practically meaningful outcome. Since as you said, you were already a billionaire in 2017 any money you could make by writing software yourself seems insignificant
For onchain prediction markets specifically, the pseudonymous addresses are actually more traceable than people assume - you can cluster wallets by funding source patterns and behavioral timing even when fresh addresses are used. Sophisticated actors know this and route through mixers, but most don't bother.
The deeper problem PollardsRho hints at: if known insiders crowd out calibrated forecasters (who rationally won't participate when they expect to be adversely selected against), you get a market that's accurate but thin and fragile. That's the classic adverse selection death spiral prediction market designers have been trying to solve. Polymarket's bet-sizing dynamics actually mitigate this somewhat - insiders can't take all the liquidity without moving price against themselves.
if prediction market contracts really are regulated as commodities, then presumably a lot of insider trading must be legal, although there must be limits of one kind or another and probably if you do something really egregious you might be prosecuted under some legal theory.
To the extent that the value of prediction markets is in their power to predict, insider trading is kosher. Wholesome even.
In the stock market, Matt Levine likes to say that insider training is about theft, not fairness. You can be prosecuted for merely sharing info with a friend on a golf course who then proceeds to trade. Your crime is not trading (you didn't even trade), but misappropriating information you were entrusted with and not authorized to sell.
The worlds most influential people demonstrate that only power matters; that the world order we built last century through unimaginable suffering and violence matters less than securing their own personal gain; that law, morals, and order were just dreams of the weak
However, if you trade on prediction markets using insider information that was gained WITHOUT fraud, deception, or a breach of trust, then so long as the market's terms of service allow it, you can go ahead and trade on that information. Polymarket is a prime example of this: unlike traditional financial exchanges, its Terms of Service do not explicitly forbid everyday users from trading on inside information. Instead, the platform relies on a catch-all rule prohibiting activity that violates "applicable laws." This means that as long as you acquired the inside information legally—without hacking, stealing, or breaching a duty of confidentiality—Polymarket permits you to capitalize on it, treating your informational advantage as a feature that ultimately makes the market's odds more accurate.
I severely dislike these euphemisms used by prediction market enthusiasts. What exactly is the value of information like “most searched person on Google in year N”? Creating 10s of options to answer this question via gambling on Polymarket/Kalshi does not help anyone except their fellow degenerates. Heck, even events like “by N date the USA invade country X” also offer no real value, except for the insider circle to front run their own invasion and profit from it. Even worse, apparently they provide anonymity and cover to illegal participants (eg obviously US citizens) just like crypto exchanges like Binance did.
I truly question the sanity of those who believe that prediction markets are providing a positive force in this world.
However, there is large value for some people in knowing when a country will be invaded: if you live there, you know when to leave; if you are an airline, when to stop scheduling flights there, or, if a lot of people are in the first group, up until when to schedule many more flights to get them out. But I’m positive the invading army would prefer some kid in a basement didn’t make one Lieutenant General on the committee obscenely rich overnight.
I wished the focused on markets where many people are part of the decision, like elections. There, the wisdom of the crowds would add some value.
Are there any examples of people/companies trusting degenerate gamblers on prediction markets and making real life-changing decisions?
All the examples I’ve seen are exactly what I started in my original post - the insider circle opening a massive position on the right invasion date mere minutes/hours before they actually do it. This is useful to precisely nobody! And it happens because they are insiders, who want to avoid risk of exposure. Not to share their godly wisdom with the world for others benefit.
Aside from those tertiary effects, perhaps people would pay Google to know this information ahead of time but previously lacked the coordination to make a deal directly.
I'm sure people with business (plans) in country X question your sanity too. Markets create value, not postitve force. Only people can do that.
It's also not on archive.org Wayback Machine it seems.
So can anyone please copy and paste the article contents here? Thanks.
Ah yes the famous credit card data and Walmart parking lots example that hedge funds were giving a few years ago in every interview and news article. Safe to assume that specifically these data sets are not what you should look at to make money.
It’s an interesting question, my hunch is that for now “in-distribution reasoning” is going to be much more effective than custom data query APIs. But perhaps not! I’d read that paper.
I don’t think that’s right. Prediction markets fall under CFTC oversight, and the CFTC absolutely has insider trading rules. We just haven’t seen any enforcement yet. Partly because the space is still new, and partly because enforcement priorities have been uneven lately (to put it mildly).
The CFTC has already signaled it’s starting to look more closely at insider trading in prediction markets. It's almost certainly just a matter of time. It's pretty likely a future administration will clamp down on this, if the current one doesn't.
Or is the info only available later?
I'm guessing that bots predicting insiders and copying positions is already a thing.
Orders aren't public though. Only the actual trades. This is important because by the time the trade is known by others very often the edge is gone. Especially if you have other people watching the same trader and they all try to copy the trade at the same time.
Even if there wasn't any kind of insider betting going on, it just seems so disgusting to turn literally everything into a casino.
There's a bet going on right now about Jesus coming back before 2027 [1], and a part of me wants to do it because I'm pretty confident Jesus isn't coming back by the end of the year (or any year), but it seems kind of wrong to try and extract money out of people who are gambling away their money.
[1] https://polymarket.com/event/will-jesus-christ-return-before...
Also, I'd advise against betting on the Jesus market. You can't actually read the price as a probability here due to time value of money, opportunity cost, etc. So you'd lose money (or at best, gain nothing) by betting against it. It's priced correctly.
Yeah, and assuming Jesus doesn't come back that's only about a 3.6% return rate, which is what Treasury Bills are getting right now [1]. At that point I might as well do that and avoid paying state tax on my interest.
[1] https://home.treasury.gov/resource-center/data-chart-center/...
https://www.reuters.com/investigations/inside-trump-familys-...
