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androidsixteen
@androidsixteen.eth
I forget who casted it, but someone here made the great point that political markets don’t actually “predict” outcomes very well They mostly just track other people’s sentiment until the end and then whiplash to converge with the outcome (mostly just arbitrage at that point) That’s probably why liquidity is so poor
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@baseddesigner.eth
They don't predict, they show where people are right at this moment with the money they put for it
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Alex
@asenderling.eth
I'd be very curious to see how different these markets looked like if they were as easy to participate in as buying a stock on Robinhood. The 'sentiment' of people savvy enough to bet on Polymarket is probably also having it's own impact.
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xh3b4sd ↑
@xh3b4sd.eth
I am not sure how well prediction markets can actually predict outcomes reliably. My hunch is that a lot of MEV is happening in the sense that accounts try to shave off basis points for profits. That MEV improves liquidity. I think there are two reasons why liquidity is not always great and why markets don't always get it right. For one you got only a rather smallish user base participating. And then people make bets that are not too well informed. For instance, how well do Americans predict outcomes of French elections? What's likely to happen often is that some competent users get it right but they are the drop in the ocean amidst a sea of MEV.
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Matthew
@matthew
I'm kind of curious what would happen if you removed the "no" option—i.e. you can only bet "yes" on something you think will happen.
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Gabriel Ayuso
@gabrielayuso.eth
Yeah this is 100% my thinking. They don't predict anything. You see this during NFL games the odds just follow what happens during the game and they can completely flip.
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cqb
@cqb
I feel like prediction markets are where online poker was in 2010ish, overly saturated by amateurs leaving room for skilled players to enter the game and reap the rewards. Once the skilled players make up the major liquidity hopefully they will be more accurate. I guess we'll see how it plays out though
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Kuripto55
@kuriput55
This is a great post. I followed you. I would be happy if you followed me back.
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