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Prediction Markets: Tales from the Election

vitalik.ca

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Re: Prediction Markets: Tales from the Election

#121

Post by btilly »

camjohnson26 wrote: post #109
btilly wrote: post #30

Earlier quoted context omitted.

Opening the bet that they die on a particular date is a problem because they know when to be careful. Opening a market on when they will die that goes to the person who is closest to the right date, now any would-be assassin can place their bet and try to win. And the target may know that people are hunting for them, but won't be forewarned of when.

They would need a counter party to be able to place the bet though, and those people have an equal incentive to keep the person safe. If no counter party exists then there’s no incentive. Plus this ignores risks outside the market, like the risk the would be assassin gets caught and sent to prison.

It is a winner take all market. All money placed in the market goes to the winner.

So if I want Donald Trump dead and am willing to pay a million dollars, I start the market and put a million dollars in for tomorrow. Eventually he dies and someone collects. Almost certainly not me, and not necessarily an assassin.

But any would-be assassin who wants can place a bet and now has a million dollars riding on whether they succeed.

This is not novel, the idea has been around for a quarter century. See https://en.wikipedia.org/wiki/Assassination_market for more.

Re: Prediction Markets: Tales from the Election

#122

Post by drdeca »

jtxxwl2 wrote: post #106
mvc wrote: post #91

Earlier quoted context omitted.

May I be so bold as to suggest that not all vote rigging conspiracies are considered impossible. Just the ones that have been rejected by every court that has tested them.

One theory I've heard is that the magical soil in the US would compel the riggers to confess and/or provide evidence of their guilt to the courts and to the general public, rather than lying and/or concealing that evidence. In the rest of the world, courts often are not provided with relevant evidence or confessions, and therefore rigging remains possible.

If you remove the putting of stupid words in others’ mouths from this (great going there, btw), the only thing that remains is “but the courts could have not gotten the evidence”.

But if the evidence is not available, then there is no good reason to believe it. You have to explain why people claiming it have enough evidence to believe it, but the courts don’t have enough evidence for it to be even claimed in the courts, if you want to claim that the reason is that courts don’t have access to the evidence.

Re: Prediction Markets: Tales from the Election

#123

Post by jldugger »

ahnick wrote: post #110
jldugger wrote: post #94

Earlier quoted context omitted.

But your source of funds might be. Sounds like the OP avoided this by borrowing against assets, but since his assets are volatile blockchain stuff, the interest rate was absurd.

The interest rate on the loan was 3.5%. Long term capital gains in the US are typically 15% (short term 30%), so using a CDP can save a lot of money depending on the tax laws that apply to you.

Huh, I thought I saw 35 percent APY but admittedly I wasn't playing as close attention to the numbers as I would if my own money was on the line.

Re: Prediction Markets: Tales from the Election

#124

Post by jtxxwl2 »

j4yav wrote: post #120
jtxxwl2 wrote: post #106

Earlier quoted context omitted.

One theory I've heard is that the magical soil in the US would compel the riggers to confess and/or provide evidence of their guilt to the courts and to the general public, rather than lying and/or concealing that evidence. In the rest of the world, courts often are not provided with relevant evidence or confessions, and therefore rigging remains possible.

Doesn't this path lead to believing anything you like, once you free yourself from the chains of needing evidence? I feel like I'd lose all track of what is real if I used this logic.

My understanding is that people in those other countries have not been lead down such a path, even though they know that sometimes people get away with stealing elections in their countries. I believe they use reason and inference when judging what is real, because all relevant hard evidence is not always available to them.

Re: Prediction Markets: Tales from the Election

#125

Post by f430 »

rspeele wrote: post #114
f430 wrote: post #98

Earlier quoted context omitted.

It's worse that people actually believe it is a reliable way to predict the future especially now with the pseudo-intellect speak that people in the crypto space resort to. If wisdom of the crowd worked then casinos would be out of business. There's an entire industry on the other side.

> If wisdom of the crowd worked then casinos would be out of business. That does not follow. In prediction markets or sports betting, the gamblers aren't betting against the casino. They're betting against each other, and the casino (PredictIt, BetFair, etc) is skimming off the top, just like Duke & Duke in Trading Places. Most forms of gambling where players do bet directly against the house are games of pure chance…

> In prediction markets or sports betting, the gamblers aren't betting against the casino.

Are you saying the crowd has an edge over the house? Sports betting platforms, poker sites, they are in the business of profiting off people who think they have an edge (aka ppl believe in the non-zero sum nature of these markets)

Re: Prediction Markets: Tales from the Election

#126

Post by Kranar »

Tenoke wrote: post #118
Sniffnoy wrote: post #116

I mean speaking personally, the reason I don't get in on such things is that I'd have to hold cryptocurrency. This means both technical complexity (Buterin discusses the fairly low complexity of getting into such markets once you know how to effectively use Ethereum, but not that of getting up to speed on using Ethereum in the first place) and a security problem: Either I keep it in an exchange and have to worry abou…

It took me just under 5 minutes to go from debit card to Poly.market in the summer the first time I bet on it, though I later did it with my bank account via Coinbase for slightly lower fees.

I decided to just go for it, I mean if there's free money like this article suggests, why not take it? I can throw the minimum 250 bucks at this and expense it on the company card for research purposes.

There's literally a market for whether Donald Trump will be president on March 31st of 2021 with offers available at 98 cents, so presumably I can make a 2% return in a month right?

Okay well I signed up, I had to buy USDC and that cost me 8%. In the future I should use Coinbase to cut that down to 0.50%, but for now my motivation is just to see if this thing is for real.

After a fairly smooth sign up process that took about 10 minutes, involved confirming my e-mail address, an SMS and then verifying a credit card transaction, I got the 230 USDC sent to me and immediately used it to buy NO on Trump being president.

I wont lie, this was easier than I expected, the whole process took about 10-15 minutes tops and as far as I can tell I do legitimately have this position.

I guess the only concern left is whether there's some loophole that will cause this market not to resolve at all/become invalid.

I will do a few more transactions later today since the site is literally displaying some fairly significant arbitrage opportunities. I will do it with just a couple hundred dollars at a time as a proof of concept, and if this works out then perhaps I go a little deeper, use Coinbase Pro to buy and sell the USDC.

Re: Prediction Markets: Tales from the Election

#127

Post by drdeca »

Supermancho wrote: post #56
vonwoodson wrote: post #52

Earlier quoted context omitted.

Thank you for pointing out the obvious: That even on HN people talk before they know even they tiniest thing about who or what they are talking about.

> That even on HN people talk before they know even they tiniest thing about who or what they are talking about. Regardless of the author (I don't bother to google every author) the content is as stated. It's a crypto-ad and not much else.

I think the expectation of the article is that the reader knows who the author is, and therefore expects the article to be pro ETH , insofar as it mentions it.

Re: Prediction Markets: Tales from the Election

#128

Post by roganartu »

notahacker wrote: post #61
jetrink wrote: post #39

Earlier quoted context omitted.

One recent example is the man who ran onto the field at the Super Bowl after having proxies place $370,000 in bets on that occurring. However, he bragged about what he had done on a radio show and those bets were invalidated.

Another example that springs to mind is a British bookmaker that ran a promotional betting offer on a fat lower division substitute goalkeeper eating a pie during a televised cup match. The fat goalkeeper ate a pasty whilst sitting on the bench, and was promptly banned for a couple of months even without any evidence of financial gain for "intentionally influencing a betting market"

There was another example of this in Australia back in 2016 where some prediction markets offered a novelty bet on what colour tie one of the TV hosts would wear.

The host got wind of it and, for fun, changed ties at least five times throughout the evening.

https://twitter.com/sportsbetcomau/status/749219697359396864

https://www.smh.com.au/politics/federal/federal-election-201...

Re: Prediction Markets: Tales from the Election

#129

Post by throwsaways212a »

Tenoke wrote: post #118
Sniffnoy wrote: post #116

I mean speaking personally, the reason I don't get in on such things is that I'd have to hold cryptocurrency. This means both technical complexity (Buterin discusses the fairly low complexity of getting into such markets once you know how to effectively use Ethereum, but not that of getting up to speed on using Ethereum in the first place) and a security problem: Either I keep it in an exchange and have to worry abou…

It took me just under 5 minutes to go from debit card to Poly.market in the summer the first time I bet on it, though I later did it with my bank account via Coinbase for slightly lower fees.

I've used polymarket and want it to succeed, but it's not a smooth process yet.

Steps I had to follow to bet:

1. Send USDC to polymarket address

2. 'Claim' USDC when it arrives in Polymarket, but due to ETH gas fees, this function didn't work. It only works when they top up the relayer with ETH, so you can wait (as I did but it was emptied before I clicked), or pay more ETH yourself to self fund this conversion.

3. Place your bet

4. Wait for the bet to complete (to be fair, the team quickly resolved the market)

5. Withdraw the cash, this worked, although I got several errors throughout.

The best part here over other crypto based prediction markets is the resolution is quick (unlike the weeks/months augur can take), but that's due to the resolution being a centralised process, at which point, why am I bothered about using crypto at all? What's wrong with a traditional betting exchange like Betfair?

Re: Prediction Markets: Tales from the Election

#130

Post by jldugger »

f430 wrote: post #98
xalava wrote: post #37

"Prediction markets" is a fancy word for gambling. It is a highly regulated activity almost everywhere, mainly has it can have terrible consequences at the individual levels and major side-effects such as corrupt games in sports. Let's not even talk about politics where it is generally forbidden for obvious reasons. The conclusion is disheartening "It shows a lot about how market efficiency actually works in practice…

It's worse that people actually believe it is a reliable way to predict the future especially now with the pseudo-intellect speak that people in the crypto space resort to. If wisdom of the crowd worked then casinos would be out of business. There's an entire industry on the other side.

> people actually believe it is a reliable way to predict the future

It's comical because I made like 30 percent in the span of a few months by betting against well known biases in IEM -- the investment stakes are too low for informed participants to move the market meaningfully.

But it's too low stakes to bother automating arbitrage strategies that would remove some of the bias of the public market.

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