Inside trading on the public market and on the public blockchain, that's smart!
OpenAI fires an employee for prediction market insider trading
91–100 of 157 posts
Re: OpenAI fires an employee for prediction market insider trading
#9277 suspicious positions across 60 wallets, 13 brand-new accounts appearing 40 hours before the browser launch. First confirmed case of a major tech company firing over prediction market trades. I wrote about why prediction markets have a structural insider trading problem that nobody's solved yet: https://philippdubach.com/posts/the-absolute-insider-mess-of...
Insider trading is the raison d'etre of these products.
Could also make a case for incentivizing destructive actions by insiders as well. You’re saying I could sabotage my project and make a quick buck?
Re: OpenAI fires an employee for prediction market insider trading
#93Earlier quoted context omitted.
Insider trading is the raison d'etre of these products.
Could also make a case for incentivizing destructive actions by insiders as well. You’re saying I could sabotage my project and make a quick buck?
That's basically what the current US admin is doing.
Re: OpenAI fires an employee for prediction market insider trading
#94Earlier quoted context omitted.
Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? And isn't that just between them and their company in a case-by-case sense? If there was some valuable-to-the-public information that the company did not care about keeping private but just hadn't bothered to make public, for whatever reason, and an insider traded on it on a prediction m…
> Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? Yes. Prediction markets, for corruption reasons, are regulated by the CFTC. In commodities markets, actors are assumed to be making trades based on propriety information. Hedging is the whole purpose! > …like it's a stock market where there is some society-level interest in giving part…
> I happen to guess the URL, and then I trade on it: Unfair
I can argue it is fair - anybody can try guessing the url, you don't have to be an insider to guess it
Re: OpenAI fires an employee for prediction market insider trading
#95Earlier quoted context omitted.
Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? And isn't that just between them and their company in a case-by-case sense? If there was some valuable-to-the-public information that the company did not care about keeping private but just hadn't bothered to make public, for whatever reason, and an insider traded on it on a prediction m…
> Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? Yes. Prediction markets, for corruption reasons, are regulated by the CFTC. In commodities markets, actors are assumed to be making trades based on propriety information. Hedging is the whole purpose! > …like it's a stock market where there is some society-level interest in giving part…
> I have a duty to the company not to trade on it.
To the company? Or to the stock market, as a participant in it?
Re: OpenAI fires an employee for prediction market insider trading
#96Earlier quoted context omitted.
I don't think your example refutes the fairness heuristic at all. The first case is completely fair because anybody else could have done the same thing without any special access required. The second case is unfair because you had to work at the company to get access.
Okay, then imagine you overhear at a bar. Yes “anyone could have” theoretically, but not actually. In either case, you have material non-public information that your counterparty in the market does not.
you got that piece of non public information was not because you are an insider. As long as the bar is not exclusive to insider, i don't see any difference
Re: OpenAI fires an employee for prediction market insider trading
#97Earlier quoted context omitted.
Insider trading is the raison d'etre of these products.
Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? And isn't that just between them and their company in a case-by-case sense? If there was some valuable-to-the-public information that the company did not care about keeping private but just hadn't bothered to make public, for whatever reason, and an insider traded on it on a prediction m…
The insider has perverse incentives as an employee.
Re: OpenAI fires an employee for prediction market insider trading
#98Insider trading is so trivial on the prediction markets. I'd guess that it's actually the "feature" that results in the outcomes being so accurate.
Of course. The point is not to make individual players money (that does sometimes happen as a side effect) it's to leverage their greed to find truth.
Except it's not "truth" as much as it is whatever has the most financial incentive to happen.
Re: OpenAI fires an employee for prediction market insider trading
#99Earlier quoted context omitted.
Isn't insider trading on a prediction market only wrong to the extent the insider is violating some duty of secrecy to the company? And isn't that just between them and their company in a case-by-case sense? If there was some valuable-to-the-public information that the company did not care about keeping private but just hadn't bothered to make public, for whatever reason, and an insider traded on it on a prediction m…
The thing is you're still thinking of these insiders as someone who just got a juicy stock tip from a relative. The much more serious problem is when these insiders actually have their hands on the levers which decide the outcome. It's really no different than a mobster who bets a bunch on money on an unlikely outcome then threatens one side to throw the match. What possible economic benefit is there to society to al…
This is the entire idea behind the concept of "assassination markets" - "prediction" markets on assassinations that are just thinly veiled ways to crowdsource murders by taking bets that you expect to lose against an "insider" (the killer).
Re: OpenAI fires an employee for prediction market insider trading
#100Good. I do hope corporations in general take a harder stance on this. From a society perspective people with inside knowledge fleecing randoms is not a win. We've got that somewhat under control on the stock exchange, but have this absurd situation where on prediction markets it is a free for all and everyone pretends this is fine. I also think corporations should distance themselves from individuals willing to fleec…
Honestly it seems stupid but fine to me. Like if someone random comes up to me on the sidewalk and says hey if OpenAI announces a browser tomorrow, you give me $100. If not I'll give you $1000. Obviously I'm not going to take them up on it, they clearly have inside information. If you're betting on a prediction market without insider information then you're just... The fool who is soon parted from his money one way o…
> I generally feel like people should be free to do whatever insane stuff they want with their own lives.
The problem with people doing insane stuff with their "own money" is the burden they often exact on their family or society.
Perhaps the realm of independence starts when loans are reasonable and current, there is sufficient child support, and they are meeting a base savings rate for their retirement.
Speaking of which, perhaps any UBI could also use a minimal criteria, reviewed annually but without any barriers on first year eligibility.