The United States lawmakers have reportedly introduced a new bill targeting members of the US Congress, the president and other high-ranking government officials, in a ban on using prediction markets such as Polymarket.
The proposed bill, a bipartisan effort from US Representative Adrian Smith and Representative Nikki Budzinski, was introduced on Tuesday and is called the Preventing Real-time Exploitation and Deceptive Insider Congressional Trading Act (PREDICT Act).
“In recent months, we've seen instances of little-known traders making massive profits on events ranging from war with Iran to how long a government shutdown will last, raising necessary questions about the use of inside information,” Budzinski said.
The move comes amid growing scrutiny of prediction markets in the US, with lawmakers and regulators taking aim at platforms such as Kalshi and Polymarket over contracts related to sports, war and politics. — Cointelegraph report
More than gambling
A lot of people try to pass off prediction markets as merely "gambling sites" but although the assessment on the presence of gambling elements is accurate, quite evident, prediction markets are much more than that.
This is probably the most dangerous product to exist in our time.
The reason is quite simple. When every event can potentially be monetized, reality becomes increasingly driven by profit, in a sense, we begin to lose the randomness that makes life real because the incentives of outcomes makes the engineering of them high profits.
What began as a niche solution is evolving into a market that can influence governance, becoming a politically sensitive infrastructure.
When people with privileged information can bet on events taking specific directions, what soon comes is how they can develop these events from day one to the finish line.
Soon, it isn't just about knowing what will happen, but directly being responsible for what will happen.
The information filter
As aforementioned, prediction markets may be the most dangerous product of our time.
A lot of people tend to look at AI as the number one in this regard, but artificial intelligence is just a tool that isn't inherently dangerous.
Prediction markets on the other one are, simply because there are inherent monetization, the biggest motivation for evil.
Think about it. One could use AI powered tools to attack a sovereign country, but what is the inherent benefits of doing that? How does it measure up to the costs associated?
Now if there's a bet on a prediction market that a certain country will be attacked by AI-powered drones for instance, now there's incentives for that attack to happen.
It isn't the tool itself that is dangerous, it is always the monetization layer that should be feared and in this case, prediction markets will be the biggest motivation source for plenty evil.
At the same time, they will become information filter, which is also something many predicted that AI will be.
By information filter, I mean that soon people will turn to prediction markets to track past, present and future events.
This would make these markets the "truth engine" where information is filtered by the general public for truth.
What could be worse than an "incentivized market" being the #1 source for public truth?
Exactly.