Epistemic status: Exploratory. This post would be shorter and contain more math if I'd thought about it more first. I don't like prediction markets, as currently described. They're similar to ordinary stock markets, which economists say are supposed to be efficient, but don't look it. People say "If you think the markets are wrong then you can bet on them and make a profit" but I don't actually expect that to be true, because markets don't only contain sincere attempts to optimise prices. They also contain schemes to extract money from others without adding information, or to cheat in forbidden ways without getting caught, and similar nonsense, and so honest trading strategies have to be not only beneficial but also inexploitable, or you'll just end up paying people to rob you. Most of this gets much worse in a prediction market, especially a market that is being used to inform decisions that people care about, and where who knows how many people have who knows how much private information behind their opaque betting strategies. I don't expect the libertarian zero-regulation "let the market blindly solve all our problems" will actually produce something anyone should trust here. Other facts I dislike about prediction markets: * They aren't fair in any technical sense over the value of information provided. * Can't accurately collate private information known to different participants. * Implement EDT instead of LDT if followed blindly, which they don't provide any alternative to doing. * Don't legibly convey why they reached the conclusions they reached. * Pay information ransoms to people who intentionally create uncertainty in the first place, which is a perverse incentive. * Make adding information a race to the microsecond even though there's usually no strong time pressure on the part of a subsidiser / people who want the prediction. * Include rational agents who don't think others are lying, but are betting money, even though that's clearly a zero-su