The most tweeted about elements of prediction markets are the least likely to actually be the long term winners versus web 2 counterparts:
- P2P sportsbooks wont displace trad books evidenced by Betfair v B365 and others. A lot of the volume right now is just due to jurisdictional issues.
- Parlays wont work or they will just mirror trad sportsbooks odds wise which is uninteresting. You are paying for volatility, you have to have someone paid to take that risk in the parlay
- Prediction market hedge funds are a zero. Who would want to give their edge away in limited liquidity markets?
Prediction markets entire edge is in the new category of real time news event trading and media manipulation, for want of a better word. The sportsbook elements are by far the least interesting part of the roadmap.
Best areas to invest
- UX improvements like aggregators
- Data displayers for important geopolitical events e.g. Dune for polymarket, analysis on large volume bettor accounts
- Collateral efficiency e.g. Sweeping unused USDC to lending aggregators
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