Vitalik Buterin
@vitalik.eth
Prediction markets truly are a super valuable tool for making sense of events in real time. https://polymarket.com/event/sam-back-as-ceo-of-openai
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tldr (tim reilly)
@tldr
Could prediction markets incentivize anti-expected behavior? Eg: 1. Prediction Market launched about whether Person A will take Action X 2. “No Action X” is signaled (by others and possibly by Person A) 3. Person A loads on “Yes Action X” shares at very low price 4. Person A takes Action X & profits
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Jack Miller
@jackm
That's kind of the point - step #3 moves the price and price movement and/or whale accumulation acts as a signal The extreme case where Person A commits fraud to intentionally manipulate the market is not itself without risk and would only work once at most
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tldr (tim reilly)
@tldr
Why once only? They just need to create anonymous shells to do the purchasing. Can also distribute the buying (so doesn't have to appear as a whale) Lots of people already take similar actions with tokens and NFTs and we have no idea who they are
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Jack Miller
@jackm
Fool me once ...
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tldr (tim reilly)
@tldr
But the trouble is knowing that you got fooled. That may take more than once. (You can observe this with politicians)
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Jack Miller
@jackm
Trivial when everything is onchain. I don't think we will see an epidemic of markets easily manipulated outcomes because it's obvious that given enough financial incentive the market will be corrupted It's not like we have invented gambling. These tricks have been done before and people sniff it out
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