[davidw]

Because they are, to use a technical term, "dumb as a stump". That's why they would participate despite not having any inside knowledge.

[mothballed]

Or they are hedging their exposure to an unknown by betting in favor of an event that would be harmful/costly to them.

[tptacek]

Those people want prices to accurately track risk, which is what insiders allow.

[mothballed]

Right but they themselves are non-insiders who are rationally betting.