Also one or two stones throws away from some established political group bringing up a case that prediction stats are more valid than actual ballots (or adding bets as ballots) of course this will go hand in hand with normalizing crypto-backed digital currency, normalizing betting markets in turn with less friction.
Great post. Just wanted to go even harder on your last point:
>But is it worth the sociocultural infrastructure necessary to make prediction markets usefully “predictive”
The fact is that even if these markets were very thick, the tremendous cut that the platforms take on top means that there is a fundamental limit on how predictive they can be. This is why there are frequently what appear to be arbitrage opportunities between the platforms—ie if the Kalshi prediction for Mamdani is 70% and the Polymarket prediction is 80%, buying “no” on Polymarket and “yes” on Kalshi until the predictions equalize earns you free money—since the profit from arbitraging is just going to the platform. Similarly, if you think the bet is mispriced, it’s only worth it to trade on this belief if you think it’s mispriced by more than the platform’s cut. (Btw this is not so much of an issue in the stock market because competition has driven down the cost of trading to basically nothing)
I realize this probably seems like a small potatoes issue relative to the cultural cost of these platforms but it’s useful to remember that the supposed societal upside in the form of incentivizing the flow of information is not really there!
Great read as always. A few weeks ago it was pointed out on Twitter that Harry Enten had used a Kalshi/Polymarket prediction market result as a data point instead of a poll, which felt very telling.
These markets offer near-perfect examples of what Henry Farrell calls "degraded publics," where "the technologies through which we see the public shape what we think the public is, and that, in turn, shapes how we behave..."
Why isn't this a good thing? Unlike speculation on the recursive, self-perpetuating fad-cycles of meme coins and (arguably) actual stocks, or raw dogging the pure vibes of the takes-for-likes attention economy of regular social media, these things at least ground out in actual verifiable concrete material world-events. Intuitively you would expect this to be a somewhat beneficial corrective to the delusional mania that powers the rest of the grift carnival.
Because gambling is highly addictive and preys upon vulnerable people, and because turning civic engagement into something to bet on will further degrade our democracy. Can we start there?
Google was into prediction markets very early (or sort of contingent Silicon Valley cultural reasons). They ran them internally from about 2005-2007. It was just an experiment but there were and are true believers there (and at most of the other big tech companies). So it's a natural thing for them to do, they're not just suddenly hopping on the gambling bandwagon.
That said I think the prediction market true believers haven't quite figured out how dumb the new base of market participants is. It's kind of depressing.
“Suckerfication” may be the most accurate descriptor I’ve heard for the current economic landscape. So much is now a shell game rigged to extract value from consumers rather than provide it.
I throw on Hannity about once a month for 15 minutes to see what is happening in that part of the world. Interestingly enough, the gold ads are still very much going strong. Collectible quarters that will be worth money are also big.
Twitter was kind of like a slot machine where you inserted a take and could either "win" favs and RTs or, in rare cases, be punished with job loss and social ostracism.
1) Direct mail fundraising is high revenue, low margin. There's no way around paying for postage and printing costs.
2) Prospect mailings always loses money. The objective is to find new donors. Hitting up existing donors - the "house file" mailings - is where profit is generated.
> predictions markets are effectively non-sports sportsbooks
They're also sports sportsbooks. Sports is over a third of Polymarket's weekly volume and almost all of Kalshi's weekly volume. https://dune.com/datadashboards/prediction-markets
They are sports non-sportsbooks!
Filmed this on polymarket https://youtu.be/1vj7jnA2Pyg
We are one or two Overton window renovations away from not just suckerificatjon, but patsyification and assassination markets
Also one or two stones throws away from some established political group bringing up a case that prediction stats are more valid than actual ballots (or adding bets as ballots) of course this will go hand in hand with normalizing crypto-backed digital currency, normalizing betting markets in turn with less friction.
Love that turn of phrase!
Great post. Just wanted to go even harder on your last point:
>But is it worth the sociocultural infrastructure necessary to make prediction markets usefully “predictive”
The fact is that even if these markets were very thick, the tremendous cut that the platforms take on top means that there is a fundamental limit on how predictive they can be. This is why there are frequently what appear to be arbitrage opportunities between the platforms—ie if the Kalshi prediction for Mamdani is 70% and the Polymarket prediction is 80%, buying “no” on Polymarket and “yes” on Kalshi until the predictions equalize earns you free money—since the profit from arbitraging is just going to the platform. Similarly, if you think the bet is mispriced, it’s only worth it to trade on this belief if you think it’s mispriced by more than the platform’s cut. (Btw this is not so much of an issue in the stock market because competition has driven down the cost of trading to basically nothing)
I realize this probably seems like a small potatoes issue relative to the cultural cost of these platforms but it’s useful to remember that the supposed societal upside in the form of incentivizing the flow of information is not really there!
My predictions short story https://nimnim1.substack.com/p/poly-hell
This sucks
Great read as always. A few weeks ago it was pointed out on Twitter that Harry Enten had used a Kalshi/Polymarket prediction market result as a data point instead of a poll, which felt very telling.
mamdani STUNS in polymarket securities fraud tweet
These markets offer near-perfect examples of what Henry Farrell calls "degraded publics," where "the technologies through which we see the public shape what we think the public is, and that, in turn, shapes how we behave..."
https://www.programmablemutter.com/p/were-getting-the-social-media-crisis
People have also made similar analogies between gambling and AI addiction https://pivot-to-ai.com/2025/06/05/generative-ai-runs-on-gambling-addiction-just-one-more-prompt-bro/
So you're saying there's a real arbitrage opportunity in these markets...
> Full disclosure: I’ll walk away from Tuesday’s elections about $500 up.
What subscriber level for the read max kalshi tips
Why isn't this a good thing? Unlike speculation on the recursive, self-perpetuating fad-cycles of meme coins and (arguably) actual stocks, or raw dogging the pure vibes of the takes-for-likes attention economy of regular social media, these things at least ground out in actual verifiable concrete material world-events. Intuitively you would expect this to be a somewhat beneficial corrective to the delusional mania that powers the rest of the grift carnival.
Because gambling is highly addictive and preys upon vulnerable people, and because turning civic engagement into something to bet on will further degrade our democracy. Can we start there?
Google was into prediction markets very early (or sort of contingent Silicon Valley cultural reasons). They ran them internally from about 2005-2007. It was just an experiment but there were and are true believers there (and at most of the other big tech companies). So it's a natural thing for them to do, they're not just suddenly hopping on the gambling bandwagon.
https://www.stat.berkeley.edu/~aldous/157/Papers/GooglePredictionMarketPaper.pdf
That said I think the prediction market true believers haven't quite figured out how dumb the new base of market participants is. It's kind of depressing.
“Suckerfication” may be the most accurate descriptor I’ve heard for the current economic landscape. So much is now a shell game rigged to extract value from consumers rather than provide it.
I throw on Hannity about once a month for 15 minutes to see what is happening in that part of the world. Interestingly enough, the gold ads are still very much going strong. Collectible quarters that will be worth money are also big.
Twitter was kind of like a slot machine where you inserted a take and could either "win" favs and RTs or, in rare cases, be punished with job loss and social ostracism.
I loved this material analysis of young men and prediction markets.
Your direct mail footnote is misleading.
1) Direct mail fundraising is high revenue, low margin. There's no way around paying for postage and printing costs.
2) Prospect mailings always loses money. The objective is to find new donors. Hitting up existing donors - the "house file" mailings - is where profit is generated.