Uncovering insiders and alpha on Polymarket with AI
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Re: Uncovering insiders and alpha on Polymarket with AI
#2Not sure why the dumb money keeps playing. If you're not the insider the person you're trading against is.
Re: Uncovering insiders and alpha on Polymarket with AI
#3> Clearly, these insiders have figured out a way to cash in on information. Whether that's kosher is out-of-scope here
To the extent that the value of prediction markets is in their power to predict, insider trading is kosher. Wholesome even.
Re: Uncovering insiders and alpha on Polymarket with AI
#4iirc polymarket doesn't explicitly rule against this, and neither does the law. prediction trading like this operates as "commodities" trading, so they have no obligation to prevent this, and indeed they have an financial incentive to let it continue (assuming others don't leave the platform!)
Re: Uncovering insiders and alpha on Polymarket with AI
#5> Clearly, these insiders have figured out a way to cash in on information. Whether that's kosher is out-of-scope here To the extent that the value of prediction markets is in their power to predict, insider trading is kosher. Wholesome even.
Indeed. For those of us not gambling, it's really quite beneficial.
Re: Uncovering insiders and alpha on Polymarket with AI
#6iirc polymarket doesn't explicitly rule against this, and neither does the law. prediction trading like this operates as "commodities" trading, so they have no obligation to prevent this, and indeed they have an financial incentive to let it continue (assuming others don't leave the platform!)
I would go even further and say that it's a vital part of prediction markets as the intended theoretical goal is accuracy of predictions.
Re: Uncovering insiders and alpha on Polymarket with AI
#7Not sure why the dumb money keeps playing. If you're not the insider the person you're trading against is.
"the dumb money"
Re: Uncovering insiders and alpha on Polymarket with AI
#8Isn’t this the motivation behind polymarket? To incentivize those that have information to bet as a signal of “truth”. What I don’t get is why would anyone bet on this stuff that don’t have insider information besides those with gambling addiction.
Re: Uncovering insiders and alpha on Polymarket with AI
#9Isn’t this the motivation behind polymarket? To incentivize those that have information to bet as a signal of “truth”. What I don’t get is why would anyone bet on this stuff that don’t have insider information besides those with gambling addiction.
It's not just a gambling addiction, but many people consider themselves smarter than the average person, and nature's way of punishing these people is creating things like stock markets and polymarkets.
Re: Uncovering insiders and alpha on Polymarket with AI
#10> Clearly, these insiders have figured out a way to cash in on information. Whether that's kosher is out-of-scope here To the extent that the value of prediction markets is in their power to predict, insider trading is kosher. Wholesome even.
Bribing employees to disclose confidential information entrusted to them is not kosher nor wholesome. I consider corporate insider trading on these markets to be analogous - if you're an employee and you trade, you are selling your employer's info for money. Nearly every employer would fire employees caught giving away confidential information for personal bribes.
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.