[fsckboy]

>But when there's a public prediction market, the only benefit is to the insiders.

false.

all the conclusions economists draw in microeconomic theory about efficient markets are based on pricing that reflects symmetric information. secrets are asymmetric. trading on inside information drives the market price in the direction it should be moving, making the market more efficient, a benefit to all participants in the market.

this is not a defense of trading on inside information, simply pointing out the mechanics.

[airstrike]

We're not solving for efficient pricing at the expense of one insider reaping all the benefits because they already either knew or set the price before hand.

[fsckboy]

if you have no knowledge of any inside information and you are trying to make a buy/sell investment decision, your decision benefits from the price being as accurate as possible. That is what every individual is "trying to solve" so it's a net benefit.

[airstrike]

except there is nothing to buy/sell here other than the prediction itself.

Or do you also think it would make sense, in a hypothetical scenario, to buy options on a stock price that is already known by some in advance? There’s a reason you’re not allowed to trade on insider information. You’re totally missing the point here.