They’re not, though. They’re making markets on all the interrelated statements. How do they know when they’re done exhausting the standing limit orders and AMM liquidity pools?
There’s no reason I can’t just say: “I’m going to implement the rules listed above, and if anyone else wants to be a market-maker, they can go ahead and do that”. The rules do prevent me from losing money (other than cases where I decide to subsidize a market). I think in some sense, this kind of market does run more on letting traders make their own deals, and less on each and every asset having a well-defined price at a given point in time. (Though market makers can maintain networks tracking which statements are equivalent, which helps with combining the limit orders on the different versions of the statement.)
In other words: at what point does a random observer start turning “probably true, the market said so” into “definitely true, I can download the Coq proof”?
Good question, I’m still not sure how to handle this.
There’s no reason I can’t just say: “I’m going to implement the rules listed above, and if anyone else wants to be a market-maker, they can go ahead and do that”. The rules do prevent me from losing money (other than cases where I decide to subsidize a market). I think in some sense, this kind of market does run more on letting traders make their own deals, and less on each and every asset having a well-defined price at a given point in time. (Though market makers can maintain networks tracking which statements are equivalent, which helps with combining the limit orders on the different versions of the statement.)
Good question, I’m still not sure how to handle this.