You know, Polymarket really works and anyone can use it right now, including US citizens; the only really serious problem with it is that it costs a flat fee of about ~$50 to deposit and withdraw, and you have to be able to figure out how to send cryptocurrency.
Some comments:
As a random smart LW person, I actually rarely have interest in participating in a prediction market, because I have to work hard to have any edge on anything, and even if I have an edge I risk betting against someone who has true inside information. I would have to value my time less or enjoy modelling things more to be an active participant. It’s not like the stock market where you are incentivized to use it even if you don’t know anything special.
It’s hard to get people to participate in long-term markets, because the payoff just isn’t very good. I have zero desire to work hard on a model so that I can make an expected profit of 10% two years from now.
$25k is a joke—is that for real? That does not pay off someone for making a good model. It also doesn’t let smart money fix a wrong price even if they magically have a perfect model. You would have to organize some kind of fund with many traders working on many models who all shared info and went in on all of each others’ trades.
More generally, I haven’t yet seen a prediction market where the “easy money” looks more attractive on a risk-and-work-adjusted basis than working on HypoFuzz. Perhaps others have similar opportunity costs?
With the capital I have on hand as a PhD student, there’s just no way that running something like Vitalik’s pipeline to make money on prediction markets will have a higher excess return-on-hours-worked over holding ETH than my next-best option (which I currently think is a business I’m starting).
If I was starting with a larger capital pool, or equivalently a lower hourly rate, I can see how it would be attractive though.
You know, Polymarket really works and anyone can use it right now, including US citizens; the only really serious problem with it is that it costs a flat fee of about ~$50 to deposit and withdraw, and you have to be able to figure out how to send cryptocurrency.
Some comments:
As a random smart LW person, I actually rarely have interest in participating in a prediction market, because I have to work hard to have any edge on anything, and even if I have an edge I risk betting against someone who has true inside information. I would have to value my time less or enjoy modelling things more to be an active participant. It’s not like the stock market where you are incentivized to use it even if you don’t know anything special.
It’s hard to get people to participate in long-term markets, because the payoff just isn’t very good. I have zero desire to work hard on a model so that I can make an expected profit of 10% two years from now.
$25k is a joke—is that for real? That does not pay off someone for making a good model. It also doesn’t let smart money fix a wrong price even if they magically have a perfect model. You would have to organize some kind of fund with many traders working on many models who all shared info and went in on all of each others’ trades.
I don’t use Polymarket because, relative to a material investment,
The base rate of crypto institutions losing everything through hacks, fraud, etc. is way too high
On a related note, “USDC” / “Tether” does not inspire confidence
Conversely, volatility—“it would have been a shame if I earned $50,000 betting against Trump but simultaneously lost $500,000 missing out on ETH price changes”
More generally, I haven’t yet seen a prediction market where the “easy money” looks more attractive on a risk-and-work-adjusted basis than working on HypoFuzz. Perhaps others have similar opportunity costs?
USDC is a very different thing than tether.
Do you have most of your net worth tied up in Eth, or something other than USD at any rate? If not I don’t see how the volatility point could apply.
With the capital I have on hand as a PhD student, there’s just no way that running something like Vitalik’s pipeline to make money on prediction markets will have a higher excess return-on-hours-worked over holding ETH than my next-best option (which I currently think is a business I’m starting).
If I was starting with a larger capital pool, or equivalently a lower hourly rate, I can see how it would be attractive though.