[SwellJoe]

I've put a small amount of money into Predictious to play with it, and they resolve the problem of contracts by locking your funds when you buy into a particular prediction.

So, if you short shares, it locks up the full amount you would owe if your prediction is wrong. Going long only takes the amount of the bet (since that's all you can lose). It's kinda confusing and difficult for me to wrap my head around it, honestly, so I probably won't be doing a lot of that sort of thing.

But, it is a necessary part of the economy, I think. Having markets for all sorts of risk provides the ability to hedge against volatility. I don't think Predictious is really doing that, right now...it's sort of a thinking mans gambling site, as far as I can tell. Which is, as you note, less exciting and interesting than a proper futures and derivatives market.

But, legality is definitely up in the air. Americans can't participate in Intrade, for example, so I guess futures markets aren't legal in the US. I'm gonna guess that once Bitcoin looks like a currency to the US government there might be a stink about Predictious, too. I'm sure I'll be bored of the concept before then.