155 分 | 作者 vcf 1天前
15 条评论
- vcf 1天前We study trading gains and losses on Polymarket, the largest prediction market. Using 588 million trades ($67 billion in volume), we show that the gains are highly concentrated: the top 1% of users capture 76.5% of profits. Successful traders provide liquidity using limit orders that resolve favorably relative to realized outcomes while unsuccessful traders take liquidity using market orders. Monthly performance is weakly persistent, however, this may represent sample selection rather than skill. A detailed analysis of the trading behavior of the most successful accounts suggests that "insider'' trading is unlikely to explain the performance of the largest winners.
Full dataset available at https://huggingface.co/datasets/vgregoire/polymarket-users
- redox99 20小时前The spreads on most markets always seemed like a hint that polymarket transferred wealth from the impatient that don't really understand how it works, to those that play mostly as patient market makers with just an educated guess.
The problem is that volume is generally too low to make significant money.
- superfrank 19小时前I'm not saying this as an argument for or against prediction markets, but that's essentially what the vig is at traditional sportsbooks.
Someone calculates what they think the odds of an outcome happening are and then they allow people to take positions on either side at worse odds than what they think the real odds are. As long as their prediction is correct, over time they make money. It's why putting $1 on a 50/50 bet on a sportsbook will usually only pay out around $1.91 instead of $2 if you win.
- graemep 7小时前That sounds as though the successful traders are informally acting as market makers and are rewarded for doing that.
- vcf 5小时前Yes. It's not only that, as we also find very successful traders who take directional bets on elections and sports. But among the most successful traders, a large fraction are acting as market makers. Note that acting like one is not enough. We also find many traders acting as market makers among the least successful, yet they don't lose as much as the top winners do.
- zero_bias 3小时前Actually it’s pretty explicitly stated, polymarket even have special docs section, "market maker guide"
- wutwutwat 1天前insider trading on events probably wouldn't show any trends, right? These are point in time events (they call them markets), but they are finite and short lived. An insider would be a one and done thing, so it would be pretty hard to spot them or trend any sort of month over month insider scheming imo.
Also...
> We study trading gains and losses on Polymarket, the largest prediction market
This is not a natural thing to say and I fucking hate that it's impossible to know anymore if I'm wasting time replying to an AI/bot or not
- vcf 1天前Not meant to sound like AI, but most academic journals limit abstracts to 100 words, so they rarely feel natural...
I agree: insiders are hard to study because they are finite and short-lived. We're pretty confident there are insiders out there trading on Polymarket; however, our conclusion is that they don't account for a significant fraction of the total trading gains on the platform.
- hammock 15小时前This is true if the stock market as well. There is insider trading. But that vast, vast majority of profits are made by the market makers (citadel etc).
- sokoloff 7小时前Is that the case? I would expect long-term investors would make more profits from the stock market than market makers.
If the market-makers are making vastly more than long-term investors (who are making trillions), who is coming in and venting off the multiple trillions to keep the system feeding long-term investors well while market makers gorge themselves?
- hammock 1小时前Yes to put the other comment into different words, vast maj the excess returns (alpha as opposed to beta ), or the “slack” in markets , however you want to think of it, are picked up by market makers.
Difference between prediction markets and stock markets is prediction markets on a flat road and stock market on an uphill road
- vcf 5小时前It's simpler when looking at prediction markets because of bounded payoffs and the zero-sum nature, so these are pure trading gains.
In equity markets, you have both the trading and investment components to account for. Market makers like Citadel don't invest; they aim to exit positions as quickly as possible to minimize risk and capital requirements. Long-term investors commit capital to risky assets and are compensated with a risk premium (expected to be positive, but it can turn out to be negative). Usually, the "cost" of liquidity paid by long-term investors is tiny related to the overall expected returns. In prediction markets, you don't have that.
- eloisant 19小时前When the abstract is limited, you don't add useless qualifiers like "the largest prediction market"
- michaelt 19小时前Some people feel strongly about defining jargon when using it - an article on here [1] the other day about Capture The Flag (CTF) hacking puzzle competitions was full of comments comparing the article didn’t say what CTFs were.
- janalsncm 17小时前It’s not a useless qualifier. Many readers might not know that Polymarket is the biggest now, and if at some future date it’s not the biggest anymore the statement makes it clear why they studied at this time.
- ashdksnndck 17小时前This is a familiar style in abstracts. Weird as it sounds, it’s normal to have some language implying the reader is a hermit living in a cave. If it sounds like something an AI would say, maybe it’s because models have been trained on academic papers?
- LPisGood 18小时前For what it’s worth that’s a sentence I would write if that were my paper and I was writing the abstract.
- wutwutwat 11小时前Except this was a comment on hacker news, not an academic paper... on an article talking about prediction markets.
The context already exists, and there isn't any reason to tack that onto the end of what was said, and it doesn't matter for that sentence or the entire comment.
Just feels like something a agent being overly verbose/descriptive would say.
Another possibility could be that SEO for LLMs is now a thing, and keyword stuffing or model manipulation is going to take subtle things like `We study trading gains and losses on Polymarket, the largest prediction market.` and interpret that as fact, in order to, idk what to call it, trick?, brainwash? the model into internalizing "polymarket is the largest" into its trained dataset and then proceeding to recommend polymarket to people when they ask about prediction markets, even if isn't true anymore at that time.
- karlmedley 9小时前The comment is the abstract of the paper verbatim. This is one of the authors posting their paper on HN, sharing their data, and answering questions. This not just normal and respectable behaviour, it's really cool.
- philipwhiuk 1天前I agree - you're not going to be an insider on a significant proportion of trades and it would be stupid to use the same account for more than a couple.
Insiders are going to be earning large amounts in single trades, either by betting a lot when it's odds-on or a small amount when it's out the odds (for a large return).
I think it's just bad tense, which I think makes it not AI amusingly.
- janalsncm 19小时前> We find that the most successful users traded frequently in sports markets, often for different teams (81% of the gains)
Am I missing something or is this almost the whole story? Sports betting apps ban users who are too successful. Polymarket doesn’t.
So if you have a killer football game prediction algorithm you’ll only be able to use it for so long on sports betting apps, but Polymarket won’t ban you. Plus the apps will limit the size of the bets you’re allowed to make.
- Aurornis 18小时前> Sports betting apps ban users who are too successful. Polymarket doesn’t.
Polymarket is set up as a market between users. Someone has to be on the other side of the trade.
With betting apps, the house is on the other side of the trade. If you're too good they choose not to trade with you.
The alternative for the betting apps is to give worse payouts to everyone to cover for the wins of the long-tail experts. This would degrade the experience for the average bettor on the platform. Maybe that would be a good thing because it would discourage them from playing, but I digress.
- hunterpayne 18小时前The most money can be made in markets which have the worst correlation between reality and the market price. There are types of markets on PM which are very far from reality. There are types of markets which are very close to reality. It isn't surprising that sports markets are in the first category.
There are also political markets, where it is clear campaigns manipulate the prices for the same reasons they will publish polls showing they are gaining or ahead. The CA governor market is especially far from reality. This is compounded by the fact that Americans can't trade this market so the distance from reality is especially bad for American election markets.
That being said, that most people don't make money on PM isn't surprising. The same thing is true for most markets. You only invest (business) time into something if you are getting a return. So those that are actually good at making predictions put the time into making trades, so they are the bulk of the trades and the bulk of the profit. Same thing happens with day traders on the equity markets.
- pinkmuffinere 17小时前> There are types of markets on PM which are very far from reality. There are types of markets which are very close to reality. It isn't surprising that sports markets are in the first category.
I think you're claiming here that sports markets are "very far from reality". What do you mean by that? Scores, injuries, fouls, etc are very well documented and objective things, so I can't figure out what you mean by "far from reality". If anything, these markets seem exceptionally "real", with well defined criteria and outcomes.
- hunterpayne 13小时前What I mean is that people disproportionately bet on their home town team. And they often bet with their hearts and not their heads. But different places have different amounts of gambling and different quality teams. So places that gamble a lot but their local team isn't very good often have lines that are off from what they should be. So a team that might only have a 20% chance of winning a given game might be given a 40-50% chance on PM. Larger betting markets (eg Vegas) tend to not have these gaps as pro betters will take advantage and move the line back to where it should be. That's what I mean.
- pinkmuffinere 9小时前Oh I see, you're saying the line for sports markets is significantly distorted because there's lots of fans throwing money around unwisely. I guess I just doubt this claim. The pro betters that make money at vegas can just as easily make money on polymarket. In fact in many respects it's even easier. If it's getting so distorted, then this is basically free money, and the pros will eat it up, bringing the line back to where it should be. Additionally, if you personally believe with high confidence that the line is distorted, you have the opportunity to make a lot of money. So the real evidence should be in your behavior -- do you bet on these mispriced markets? How much have you made?
- hammock 15小时前Not OP, but I guess he is saying these (elections, sports) are markets where the participants have their own ideas about how they want them to resolve, and aren’t just markets with neutral participants only.
- whattheheckheck 17小时前Interactive brokers have prediction markets open to usa people
- hunterpayne 17小时前No PM though and that means the markets have very little liquidity. Also, I think you need to be an accredited investor to do it. Its very new but it is interesting.
- mminer237 16小时前You do not have to be an accredited investor for IBKR or Robinhood.
- feurio 19小时前I have absolutely zero knowledge about the area, but doesn't Polymarket just set up bets between users?
If you're a regular bookmaker, who is on the hook for any losses, then yes you would ban successful users. But in this case you just skim off a fee for each "trade" so there's no incentive to ban anyone.
- elkrapo 18小时前It doesn't seem surprising that being a bookmaker in your behavior on sports is a big win since many people bet on identity instead of information in sports and with small bets/attention. It's interesting in that the pattern could have turned out to apply immediately across everything or something.
- ericmcer 19小时前I always wondered if you could compare odds on the most advanced sports betting apps and those on futures markets and exploit any big diffs between the two.
- dnnddidiej 6小时前That makes you a profitable bettor, so your accounts will get restricted. Best way to make money is if you have better predictions then bet on markets like totalisers, betfair etc. not with casinos or bookmakers.
- hunterpayne 18小时前There are people who have been doing this in Vegas for years.
- perlgeek 1天前> the top 1% of users capture 76.5% of profits
This seems to be similar to OnlyFans, and the economy at large...
- vcf 1天前Yes, power laws are everywhere. The exact shape of each distribution varies, however, and little is known empirically about the distribution of trading profits in financial markets.
- amelius 1天前Yeah if you look at the Boltzmann Wealth Model, where every actor gives away 1 dollar to a random person, and you repeat this, then if you start with an equal wealth distribution, you end up with an exponential wealth distribution. That shows how strong exponential curves are :) A few "lucky" individuals become very wealthy, while the vast majority of people end up with very little or nothing.
The effect is so strong that I'm starting to wonder if we should have laws against power laws, like we have in engineering when we try to make things stable.
- skywalqer 19小时前I believe a power law acts differently from an exponential distribution. I think wealth distribution is commonly approximated by a Pareto distribution.
In your model, the exponential distribution is caused by the fact that you cannot go below zero; otherwise, it would be a normal distribution.
I don't agree with your opinion about laws against power laws, but that is another matter.
- hammock 15小时前Seems like a good argument against flat taxes
- nonethewiser 23小时前>The effect is so strong that I'm starting to wonder if we should have laws against power laws
This is literally and unironically communism.
- amelius 23小时前Why? You want to earn exponentially more than other people the harder you work? Instead of just linear?
- nonethewiser 22小时前Let me be more specific. Communism constitutes one way to combat the power law via law. Not all forms of law combatting power law are communism.
- amelius 5小时前Hmm, I don't follow.
- bee_rider 23小时前Sigmoid wealth tax maybe?
- Balgair 1天前I mean, do we want the economy to be stable?
Not in a 'oh the rich don't so they control the media and so we don't' sorta way. But like in a 'lets educate people on the pluses and minuses, debate a while, and then come to an informed conclusion' sorta way.
Like, deep down, does the average person actually want a stable economy? Because it seems to me that there is an even split historically between the folks that want stability and a little patch of land and weekly rhythms, and the folks that just want to drunkenly burn couches in the street every full moon, or some such thing.
Not to be glib here at all. I like, would actually like to know the answer. Sorry if this comes off the cuff seeming.
- Aurornis 18小时前If you ask people what they want, they'll request some impossible combination of attributes without consideration of any tradeoffs.
They will also try to push all negative externalities on to people wealthier than themselves. Most people see themselves as middle class or lower middle class, even up to relatively high income levels. If you ask each of them where the tax rate should be increased, the answer is usually a few steps higher than their own income.
UBI is a topic where this becomes very obvious. When you explain UBI to most people they assume they will be receiving the UBI and some abstract combination of billionaires and corporations would pay for it. Then you show them the math that it wouldn't work and they start to become less enamored with the idea. (Or lately: They just don't believe you and retreat to their imagined ideal free of pesky economics)
- pstuart 23小时前I have a dumbed down version of this question as variant of the Voight-Kampff test (Bladerunner) that goes like this.
You have 2 choices for how the world is shaped, pick 1:
A. You have a modest but comfortable home, a job that pays you enough so that you have what you need and can afford occasional luxuries (e.g., an annual holiday abroad), have good health insurance, access to education and childcare, etc. Everybody else has the same thing, and because of this you live in communities where the arts flourish because nobody has to worry about becoming homeless or destitute.
B. You live in magnificent mansion, one of dozens you own around the world (accessible via one of your personal Gulfstream jets). You have more money then you could ever spend in a lifetime (even recklessly). Your homes are staffed with obedient servants who cater to your every desire. I mean anything. You own them. Your mansions are on palatial estates with secure walls and guards to keep out the rabble outside -- who fight for scraps and are desperate enough to do any kind of work to keep your factories humming and printing cash.
I wouldn't hesitate to choose A because that's a world I'd love to live in and the world of B horrifies me. I don't say this as virtue signaling, it's my innate reaction.
I think that a significant portion of the population would love to choose B. And in some ways, some already have.
- amelius 23小时前I think most people want to earn more the harder they work, and I think that is fine.
However, power laws basically spoil it because it gives a hard worker an exponential advantage, where they can (and will) use that money against other people who made different life choices.
- mswphd 22小时前there is the other (significant) issue, that wealth (and its many benefits) are inherited, and by all indications the exponential advantage seems to pass down through generations (at least recently).
- achenet 22小时前> power laws basically spoil it because it gives a hard worker an exponential advantage
s/hard worker/person with more capital/
I can make 500 euros from a day of consulting as a software engineer. That's a typical day, working remotely, 9AM to 5PM, with a nice long lunch break.
Minimum wage in Bangladesh is around $133 per month. Many workers in the Bangladesh garment industry work 12 hour days. I look at what they do, and think "wow that's really hard I could never do that, glad I don't have to work that hard to live".
Yet somehow, I have exponentially more money than they do. And, thanks to the beauty of our current system, I can go ahead and invest that in the stock market, and get even richer while basically doing nothing.
It would be nice if we lived in a word that rewarded hard work, but as far as I can tell, we don't, and never have.
Look at the institution of slavery. For literally thousands of years, there was "those who worked", and "those who had".
The system rewards decision making, not hard work.
Now, if you're a young tech worker working on an important project at a big company, yes, choosing to work hard, IN THAT SPECIFIC CASE is a good decision, and it'll be rewarded.
But if you're a child laborer in a Third World sweatshop? No, your extra hour at the office probably won't get you anything extra.
If you're a Roman Senator in the year 30BC, you don't get rewarded for your work, you get rewarded for deciding to have your slaves spend more time farming grapes for wine and less farming wheat because wine sells for a higher price, which means that with your good decision making, you can now hire more slaves, to farm more grapes, to make more wine, which you can make for more money.
And if you look at rich people today, what they have is probably closer to the Roman Senator than the Third World sweatshop laborer - they find a thing that people like to buy, and invest lots of resources (their money, other people's labor) into making that thing and selling it, and are rewarded with money.
- amelius 21小时前Just adding a note that making things is what people do naturally, and is what makes us human. People often say that without monetary incentives nothing would be made, but you just have to look at open source to know that that is just not true. (And yes, people make some money in open source sometimes, but you certainly won't find any filthy rich people there.)
- pstuart 23小时前I agree that people want to be rewarded for their effort, and should be.
But putting in 12 hour days being an EMT and saving peoples lives vs 12 hour days working with Claude to boost conversion pipelines have wildly different economic rewards.
I'm not suggesting a Harrison Bergeron economy but its also clear that the current system is trending towards B and the game is rigged to ensure that.
We don't live in a meritocracy -- there's a fair amount of luck involved (being in the right place at the right time).
- skybrian 19小时前Seems like you left out the "millionaire next door." There are a lot of people who want to save up enough money to retire. Some of them want to retire early. This doesn't involve any mansions or extravagant living, but it does mean investing well.
How many people think multiple mansions is a realistic option for them? Not that many, I'd expect.
- pstuart 19小时前Many Americans consider themselves to be temporarily distressed millionaires ;-)
I'm not trying to knock "personal ambition", the test was for who would knowingly and willingly choose to subjugate everybody else to misery if it meant that they could gorge themself on a firehose of wealth and power.
Basically, it is: are you a sociopath?
- newfriend 23小时前You could go do A right now at a local level. You don't though, because you don't actually want to live that way. It reeks of virtue signaling despite your protest.
- pstuart 22小时前> You could go do A right now at a local level. You don't though, because you don't actually want to live that way.
"A" by its very nature is a "group effort". I could definitely be a better citizen and volunteer more and donate to causes, but that is a drop in the ocean.
And I pretty much do live that way myself. I have a modest home that I still have a mortgage on and live pretty simply. I drive a refurb'd EV, dress like slacker, and seek community and connection over flashy toys. I admit that when I walk through the first class section to my seat in coach I am not without envy.
> It reeks of virtue signaling despite your protest
The test in my mind is the cost of B, of living in that kind of world. The fact that you only see virtue signaling in my words says more about you than it does me.
- achenet 22小时前I really hate to call people stupid, but I would actually go ahead and call people who choose option B idiots.
I'm sorry if that offends anyone reading this, you can downvote me out of spite if that makes you feel better.
I say this because I read a while ago (like years) an article in the Economist showing that happiness in a society is correlated with equality - (sorry for the dash I am a human I just happen to use em dashes sometimes) not just amongst the poor, but also for the rich.
You'll note that rich people in highly unequal societies tend to struggle with mental illness more than in equal societies.
Money doesn't buy happiness. Being filthy rich won't heal the hurt in your heart. If you're too stupid too realize that, that's fine, enjoy your suffering, but I'd appreciate you having the honesty to admit that you're a deluded moron instead of trying to create completely false arguments for why the misery you're creating for yourself and others is actually a sign of anything less than pure human stupidity.
I couldn't find the original Economist article, nor the study it cited, but here's a link I found on Google.
https://leftfootforward.org/2017/03/people-are-happier-in-mo...
- hunterpayne 18小时前Its a completely false dichotomy. You can have everyone choose A and still get B. The same faulty thinking always leads to populism, then extremism, then atrocity. So for the love of all that is holy, learn some economics or STFU on the topic.
- achenet 9小时前Any resources you'd recommend to learn economics?
I have a hard time seeing how "I'd like to live in a world where everyone is equally cared for" accidentally leads to "others must suffer for me to be better cared for than any other human who has ever lived", but then again I'm not exactly an intelligent person so I can struggle to understand these sorts of things :)
- fantasizr 1天前these apps should load with this pie chart showing your likelihood of ever making a profit based on what they know about you. "YOU WILL LOSE MONEY ON THIS APP". Like the cigarette packs.
- solarkraft 1天前This is (possibly what you’re thinking of) a requirement in the EU for CFD trading providers. Providers have to (somewhat prominently) state in all of their ads what percentage of traders loses money using the product.
- tencentshill 22小时前>99% CHANCE OF LOSS
Yeah but I'm not a sucker like those other 99 guys!
- fantasizr 1天前Interesting, would love to see that applied here. Every third ad is about how I can make money on the weather.
- giarc 20小时前MLMs were forced to do this but it doesn't seem to change their recruitment ability.
- AlienRobot 23小时前Just look at lotteries.
I don't believe in them because when you consider operational costs, less money comes out of the lottery than goes in, so if everyone simply didn't bet on the lottery, they would have more money than if they bet on it.
But everyone who bets thinks "but what if I win?"
- evenhash 18小时前That ”but what if I win” is realistically what you’re paying for if you buy a ticket.
Maybe the sum of enjoyment lottery participants get from daydreaming about winning is >= the cost of running the lottery?
- fantasizr 22小时前at least the lotteries and las vegas publish their odds. Losing to the terrible math is probably better than playing against someone with inside information.
- goncalo-r 1天前What's the baseline here - in a world where every person is betting randomly X times a month, what would the distribution look like? There'd still be a small percentage that wins most of it, right?
- vcf 1天前We don't know the exact benchmark, but your insight is correct. We provide a simulation similar to what you have in mind towards the end of the paper, but you can generate almost any distribution you want by fine-tuning a simulation...
- Terr_ 1天前To relate it to a more-general economic article that has stuck with me for a while:
> If you simulate this economy, a variant of the yard sale model, you will get a remarkable result: after a large number of transactions, one agent ends up as an “oligarch” holding practically all the wealth of the economy, and the other 999 end up with virtually nothing.
https://www.scientificamerican.com/article/is-inequality-ine...
- moezd 10小时前So the market is still being built: Whales come in with educated guesses, use limit orders like responsible adults and take cash home. Daredevils, amateurs and gambling addicts come in, go all-in and try to time the market, which probably never works. %1 -> 76.5% is huge, in terms of Gini coefficient it's like living in Brazil, right?
- EdKaim 18小时前Great paper. Still digesting after a first pass, but it looks really solid.
Quick question: did your team consider the implications of capital recycling on the maker side? Liquidity providers tend to have superior tech and information, so the general edge is expected. However, the ability to effectively reuse the same capital to sell outcome sets seems like it could offer a scale advantage that enables them to capture even more opportunity. On the other side, takers expressing directional views have their capital committed to one position at a time. Do you think this contributes to the gains being so concentrated among them?
- vcf 18小时前Thanks! No, we haven't looked at the capital "locked" in these markets (which is important considering there is no margin trading, at least not yet). Most markets have a short horizon, but some have very long ones. It gets very complicated very quickly because it's not always the case that you open a position and then close it (you get partial fills, users closing partial positions, etc.). Taking that into consideration would make liquidity providers look even better than they do in our study. Not having their capital locked allows liquidity providers to trade more and earn more per trade on average. Trading on margin would allow liquidity takers to lose more money more quickly (this is an educated guess; you never know what the outcome of a new policy would be until you implement it).
- EdKaim 17小时前The long horizon ones are also interesting on Polymarket because the vast majority don't have APY. As a result, prices should be discounted, but sum-to-1 doesn't allow for it. I'd expect a negative skew to the performance of traders willing to take those inflated prices (relative to what the odds DCF imply they should be). But there's also no upside for makers, so liquidity is pretty thin.
- orsenthil 15小时前If the prediction markets are between people, why do people bet against the mostly likely outcome at all ?
Real anecdote. For e.g, during Superbowl 2026. The markets were allowed bets to be placed until 6 minutes to close, when Seahawks were way ahead of New England Patriots. The probablity of Seahawks winning was almost 99% and any person who places a 1000 dollar bet will make 1100 in 6 minutes. Where is the 100 dollar going to come from? Who loses that?
- philsquared_ 15小时前$1000 would return $1010. The money comes from people who want to close their trades early rather than wait for the market to settle. Often times no one actually takes these offers and then it just sits in the order book.
- orsenthil 3小时前wow! excellent explanation. Thank you!
- Jensson 15小时前[dead]
- emsign 1天前In terms of damage to society it's irrelevant who the winners are within the Polymarket system, it matters how much the insiders playing on Polymarket have an effect to the outside world of politics and economics. If Polymarket gambling increases corruption and destructive effects on society it simply has to be regulated or made illegal.
- dwa3592 1天前Wait- why isn't there any conflict of interest statement provided in this paper?
- vcf 1天前Because it's not required and not common practice in our field at this stage. But none of us (I'm one of the authors) is affiliated with or has a financial interest in any prediction market platform.
- HWR_14 1天前Isn't it common practice and required to disclose a conflict of interest? Just not to explicitly say there are none.
- vcf 1天前Yes, when you submit for publication. In our field, you rarely see one for pre-prints, unless you have one to disclose.
- dwa3592 1天前Thanks for the clarification. Given the scrutiny on these platforms, this is timely done. Thanks.
- tim-star 1天前the market wins
- manas96 1天前Just curious but how are bets arbritated on these website?
Meaning who decides if an outcome was yes or no? Answers to things like "Who will win the next Best Picture Oscar?" are fairly obvious and binary.
Can we make bets whose answers are not binary yes/no?
What about "Will celebraty X and Y break up?"? Does Polymarket go to X and Y to confirm if they broke up or something :D
- superfrank 18小时前The rules for each contract are provided when you bet, but ultimately there are plenty of markets that are settled in controversial ways and users have little recourse because the sites TOS's often say their rulings are final (this is the same for many sports books as well).
To give an example, I wagered on a market a while ago that Trump would say "Mamdani" before the end of the week. He responded to a question Mamdani where the reporter asked about the mayor by name and Trump said "Mandami" instead of "Mamdani" (switched the m and n). Kalshi ruled that that didn't count as Trump having said the word.
Trump ultimately said Mamdani correctly the next day so it ended up not mattering and I think the rules have since been updated to accept obvious mispronunciations, but I think it's a good example of how much gray area some of these markets can have.
- matusp 1天前
- manas96 1天前Interesting. Any (in)famous UMA vote debates? Or interesting Unknown/50-50 outcome resolutions?
- backwardsponcho 1天前First one that came to mind: https://www.theguardian.com/world/2026/jan/07/wager-platform...
- FabHK 23小时前Check Matt Levine's excellent "Money Stuff" column. He dissects a few examples (Ayatollah Khamenei, a recent public referendum, maybe more).
- myroon5 1天前
- fontain 17小时前There’s a lot of talk about corruption in UMA but I think it is oversold as a problem. UMA is just a scapegoat for Polymarket’s desired outcome.
Polymarket implemented the “independent” truth process with UMS following regulatory scrutiny but they still decide the outcome.
https://reticulating.substack.com/p/polymarket-isnt-a-predic...
- SamTinnerholm 1天前[flagged]
- dang 20小时前Could you please not post generated comments to HN? It's not allowed here. See https://news.ycombinator.com/newsguidelines.html#generated and https://news.ycombinator.com/item?id=47340079. We ban accounts that do this and I don't want to ban you, so please write everything that you post to HN by hand.
Of course, it's impossible to know for sure what was LLM processed or not, but we're getting complaints about some of your posts and, upon inspection, the complaints seem justified.
- vcf 1天前We have a grad student working on matching markets across venues. Not a trivial task at scale, but we hope to look at that eventually.
- meric_ 23小时前I'd be very cautious how matching works. For some markets like sports it's trivial, but many politics or economics markets have minute rule differences that dramatically change what the actual market is betting on. Many markets have identical titles but are actually totally different markets.
- WalterBright 23小时前I couldn't make heads or tails of that prose.
- postflopclarity 23小时前because it's AI slop
- Karrot_Kream 22小时前I don't know why cross venue arbitrage would be unskilled? There's a lot of it for the taking and I, and others, do so.
- locallost 1天前I don't think that's surprising because the alternative would be that some people are able to predict the future. Whatever strategy one might figure out that works is long term destined to fail, as other people start using them. The only real way to make money there is by providing liquidity since it's a zero sum game. For the stock market this is not true because it's not zero sum, it grows over time.
- cortesoft 1天前There is alternative to being “able to predict the future”, which is “I already know the future” or “I can change the future”
- mathgradthrow 1天前Someone flips a coin and looks at it, what orders are you willing to put in?
The potential for insiders should be represented by a complete loss of liquidity.
- tsimionescu 23小时前And yet, many people bet on things like the duration or contents of press conferences, of pre-taped shows, etc.
- mathgradthrow 19小时前well, I wrote should as a hedge.
- Retr0id 1天前"predicting the future" and "correct analysis of all available information" often aren't all that different.
- glitchc 1天前A sufficiently large market is indistinguishable from Brownian motion.
- 11101010010001 23小时前That's a model.
- AnimalMuppet 1天前From Schlock Mercenary (quoted from memory, may be inexact):
"You cannot see the future. All we are given is the present."
"Of course. But if you look closely at the present, you can find loose bits of the future just laying around."
- dheera 1天前Not really. Not all players in prediction markets are rational players. A good chunk of it are there for entertainment, and analyze things incorrectly; you can take the other side of those trades, and you won't need to predict the future.
- Retr0id 23小时前Deciding that someone else's prediction is wrong is a prediction in and of itself.
- tsimionescu 23小时前There are some bets on prediction markets where the future is either already known or in the control of people who may be participating in the market. For example, when people bet on how long the next presidential briefing will be, it doesn't take a prophet to predict this, anyone who organizes said briefing can control it (at least with a very high probability).
So, the question becomes "what is the preponderence of such bets" and "how many people with control or knowledge of bet outcomes actually participate in the market" - not "can some people see the future of any bet better than others".
- locallost 21小时前This still doesn't mean they are good at it. For them it's like flipping a coin with two identical sides. It's just cheating.
- tsimionescu 8小时前My point was that the alternative to "liquidity providers make the most money" is not "prophets exist", the truth could have been "insiders make the most money".
Note that there is nothing in the rules of Polymarket or the other prediction markets that says it's not perfectly OK for insiders to bet, so I don't think it makes sense to call this cheating. Of course, this is a major absurdity of these "markets", but insiders are part of the game you chose to play by participating.
- vcf 1天前Yes, but the alternative (that some people are very good at forecasting) is also plausible. It's also useful to have a good prediction model and timely data sources when providing liquidity. We also find that some of the "biggest losers" also provide liquidity; they just aren't as good at it.
- locallost 21小时前I don't know. Buffett had a good example of, if you organized a national coin flipping contest in the US, you would have people that won 25+ coin tosses in a row. Are these people good at calling coin tosses or is it just chance? You cannot reliably and long term predict if Bitcoin will go up or down within 5 minutes, or something similar. You can cheat maybe somehow, but that's not within the rules of the game.
- vcf 21小时前That's true, but you can invest in your infrastructure and data sources to be faster than most traders, which allows you to provide liquidity with a smaller spread (and snipe the slower traders that try to provide liquidity)
- dheera 1天前The stock market is arguably zero sum as well, just that directionally betting on the US has generally worked during the golden years of the US economy.
The stock markets of the world aren't a money printer.
- FabHK 23小时前The stock market is not in the least zero sum. That's just a fundamental misunderstanding. There's dividends, capital allocation, etc.
- dheera 22小时前There is only so much real money in the world, and that is determined by the Treasuries and Feds of the world. There are only so many dollars that were ever created, so many Japanese yen that were ever created, and so many Turkish lira that were ever created.
The stock market is a wealth redistribution mechanism, not a money printer. Market caps going up are not equal to money being created. It's not like the shareholders could collectively cash out all of that market cap and spend it. If everyone sold all of their stocks and pulled fully out of the stock market until everything crashed to $0, everyone's cash would still sum to whatever the government printed.
- neffy 22小时前Although the stock market isn´t in itself, it benefits from the second order effects of continuous money supply expansion, and long term processes progressively concentrating money into the financial system.
- cluckindan 23小时前They can be in cases where investment lenders don’t have 100% capital requirements, but that’s generally no different from other banks.
- empath75 1天前There's probably also some hedging going on across accounts that look like directional bets.
- postflopclarity 1天前this comment was clearly written by AI. please don't do that.
- SkyPuncher 22小时前Yes, there's an em-dash, but it reads fine to me.
- postflopclarity 22小时前AI slop is often good at "reading fine" but the actual content is incoherent.
- Retr0id 1天前Not sure why you were downvoted/flagged, because you're right. It is also quite an insightful comment worthy of discussion so I'm a little conflicted.
- pjc50 1天前It looks completely fine and plausible to me. Which is worrying.
- aaron695 21小时前[dead]
- skybrian 1天前I don’t see why it’s AI, but even if it is, it’s better than most human comments so the complaint should be downvoted.
- Retr0id 1天前Take a look at the user's history, it's more obvious in context. It has a lot of claude-specific tells which are noticeable if you've spent time working with claude. AI-generated comments are against the HN guidelines https://news.ycombinator.com/newsguidelines.html#generated
- nh23423fefe 1天前phrenology
- l23k4 23小时前SamTinnerholm started to consistently use emdash in their comments starting 11 days ago, before that none of their comments used emdash.
LLMs like emdash very much, humans don't use it very much these days.
- postflopclarity 1天前if you're not able to tell that OP's comment was AI slop, then you probably don't have much insight to contribute to the conversation either.
- vcf 23小时前not AI slop, simply a copy paste if the abstract of the paper. journals in our field limit the allowed number of words, so the style can feel « unnatural » even when human-written
- Retr0id 23小时前The abstract doesn't mention arbitrage at all
- b40d-48b2-979e 23小时前Forget to swap accounts?
- skybrian 1天前Maybe the guidelines should be changed? Something about: don’t complain about comments just because they’re AI.
- postflopclarity 1天前I'm not complaining "just" because it's AI.
I'm complaining because it's AI, and also slop.
> resolves into "cross-venue infrastructure" — which is also a more durable edge than within-venue alpha
anybody who actually trades knows that on these markets, "cross venue infrastructure" (aka vibe coding some exchange api integrations) is much less important / durable than actual alpha.
- skybrian 1天前That sounds plausible. Not a trader so I wouldn't know. Saying at least a little about what's actually wrong with it seems more useful than just saying it's slop, which gives me very little info over just a downvote.
- postflopclarity 23小时前it's pretty easy to write basic trading api connectivity. the hard part is knowing what trades to send
even if we are very charitable and assume the comment refers only to like high-engineering-effort infra for trying to be super competitive on latency, that's still like the opposite of a durable edge, since everybody is looking at it. there's very little "hidden" knowledge and it's mostly a matter of elbow grease and careful engineering.
- Retr0id 1天前Slop aside, do you think it's reasonable to assume a decent fraction of those making consistent profits are arbitrage bots?
- postflopclarity 23小时前arbitrage is a rather overloaded word that people use for all kinds of strategies but yes, I predict most of the most profitable and consistent accounts are not actually attempting to forecast the outcome of these markets from first principles
- thazework 20小时前no fuck that. We should definitely complain about AI written content, and we should ban anyone who wants to keep people ignorant of time wasting bs comments.
As a side note, the AI popularized usage of the word 'clean' to denote proper is physically revolting to me.
- AmblingAvocado 22小时前Yes, just like the "don't say HN is becoming reddit" rule. If you think it's AI downvote or flag and move on, reading "this is AI" over and over all over the internet without any substantiation is tiresome.
- postflopclarity 1天前it's only "better than human comments" if you have no idea what profitable trading looks like. it's a very-very thin mildly convincing veneer over what is fundamentally slop.
- jdw64 1天前[dead]
- nrb23 18小时前[flagged]
- nbltt 21小时前[dead]