Astral Codex Ten • 14109 implied HN points • 13 Jan 26
- Prediction markets have exploded in volume and produce accurate probabilities, but most activity is degenerate gambling and they haven’t yet changed how society or the media make decisions.
- Vague resolution rules and decentralized oracles cause frequent disputes, insider trading concerns, and "rulescuck" losses, and proposed technical fixes (like using LLMs) carry their own risks.
- Conditional "decision" markets could be transformative if they can avoid confounding — one proposed fix is markets that predict the eve-of-decision market prices — and AI superforecasters may soon supplant human markets, leaving either better user-driven platforms or AI-led forecasting as the likely path forward.