[HN Gopher] OpenAI fires an employee for prediction market insid...
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OpenAI fires an employee for prediction market insider trading
Author : bookofjoe
Score : 262 points
Date : 2026-02-28 13:46 UTC (9 hours ago)
(HTM) web link (www.wired.com)
(TXT) w3m dump (www.wired.com)
| bookofjoe wrote:
| https://archive.ph/FOet2
| xrd wrote:
| A fun aside: this person obviously created a bunch of new Bitcoin
| accounts to hide their activity.
|
| It makes you think that if you were able to surreptitiously add
| malicious side channel software into a popular npm package that
| you wouldn't just need to hunt for crypto wallets with balances.
|
| You could also probably find a market for crypto wallets with
| small balances or zero balances. The history and date of creation
| would be the value to some.
|
| This openai employee should have gone on the dark web to buy
| older addresses to cloak their activity.
|
| It's sad to say that almost all crypto use cases point to fraud.
| I'm excited about crypto and there is some fascinating research
| around anonymous transactions (like zcash). But, that real
| utility is always overshadowed by the actions of charlatans or
| worse.
| 0x3f wrote:
| I don't really understand. You can create wallets at will. What
| would be the value of one that someone else happened to create?
| xrd wrote:
| If it has a small transaction history it obscure the owners
| intentions. An address created right before a wager is
| obviously for one purpose.
| 0x3f wrote:
| Right but if you have the forethought to go buy such a
| wallet, you could just make one yourself in advance and
| create a transaction history.
|
| Although I would argue that even this doesn't have much
| value. It's not a big problem that people know "there
| exists an insider at OpenAI". There are plenty of employees
| there that shield you from being discovered.
|
| In fact it would be so difficult to find this person among
| them, assuming the most basic opsec, that I'm highly
| skeptical they actually fired anyone. I would sooner assume
| this is just an announcement designed to discourage the
| behavior, since no specifics are provided.
| xrd wrote:
| You are giving a lot of credit to this criminal. I really
| doubt they thought about this long in advance of the
| crime. Are you suggesting they got hired at openai so
| they could make calculated wagers at Kalshi? This was
| more likely a crime made impulsively.
| 0x3f wrote:
| First of all I'm not sure what they did is criminal. And
| it would have been Polymarket.
|
| Nonetheless, you can just be a pre-existing OpenAI
| employee. As long as you take basic precautions, they (as
| in, OpenAI), are not going to be able to find out it was
| you.
| TZubiri wrote:
| Aged accounts, shell companies, it's a market
| 0x3f wrote:
| Not in this context it's not. Companies can't create
| Polymarket accounts. Polymarket accounts are just email
| addresses or alternatively crypto wallets. And there's no
| purpose I can imagine to aging them.
| dontknowbtc wrote:
| > created a bunch of new Bitcoin accounts to hide their
| activity
|
| tell me you don't understand crypto without telling me you
| don't understand crypto.
| ruined wrote:
| you can't "change the password" on a wallet, so a "used" wallet
| is highly unattractive. anything you put in it could be taken
| by the original keyholder who sold it to you.
| asah wrote:
| just move it to a new wallet
| JasonADrury wrote:
| Oh but you can. You can swap out the seed and generate any
| new addresses using that.
|
| Yes, the old _addresses_ will be compromised. That 's fine.
| The point is that nobody can tell that you aren't actually
| using the same keys to generate new addresses anymore.
| pclmulqdq wrote:
| This is no different on the outside from making a new
| account.
| MarceliusK wrote:
| What investigators often look for isn't just wallet age, but
| funding patterns, timing, and linkages between wallets
| chazftw wrote:
| That's pretty common, you may think you own the data you work on,
| but you don't. It's proprietary confidential.
| re-thc wrote:
| > you may think you own the data you work on, but you don't
|
| It's called <open>AI.
| dgellow wrote:
| why would you think you own data you work on
| 0xTJ wrote:
| Who would think that? At every corporation where I've worked
| it's been explicit in both the contract and in HR training that
| this is explicitly not allowed.
| cjonas wrote:
| Insider trading is so trivial on the prediction markets. I'd
| guess that it's actually the "feature" that results in the
| outcomes being so accurate.
| crazygringo wrote:
| Yup. There are good reasons why it's a problem in financial
| markets but NOT usually a problem in prediction markets:
|
| https://www.economist.com/leaders/2026/02/18/why-insider-tra...
|
| > _In prediction markets, informed trading is not a crime or an
| injustice--it is a valuable service._
|
| A big exception, however, is using prediction markets to make
| predictions on events regarding publicly traded companies.
| rfv6723 wrote:
| The concept of a valuable service falls apart if players can
| influence the actual event. Without equal footing and basic
| honesty, you aren't measuring reality so much as you are
| subsidizing those with the power to manipulate it.
| crazygringo wrote:
| Yup. That is the other big exception described in the
| article.
| deadbabe wrote:
| There's a feel good story where a parent can't afford a
| very expensive medical procedure to save a child, so
| someone tells them to place a massive bet in a prediction
| market for a certain event that may happen, and then they
| make it happen, therefore siphoning off money from the
| other gamblers for a good cause. Just a small way everyday
| people use the system against itself as a way to survive.
| notepad0x90 wrote:
| why are publicly traded companies special? The speculation is
| not on securities.
|
| You're not participating in a "market" (even though they call
| it that), you're purely gambling and speculating. People have
| been doing this since currency was a thing. Even gambling
| laws don't apply in my opinion. If I told you the government
| will publish evidence of aliens existing tomorrow, and we
| make a bet on it, that's not really gambling, it's not so
| much a game of choice as it is a competition of who can
| predict things better. The other person might have insider
| knowledge, but it's up to you to either take on that risk or
| assume despite that your knowledge about the topic will
| overcome their potential insider knowledge.
| danny_codes wrote:
| It's literally gambling what are you talking about
| mlsu wrote:
| Prediction markets have only events whose outcome is
| eventually publically resolved, by design. With insider
| trading, the trader is incentivized to release the
| information as late as possible, as close as possible to the
| events.
|
| Why are these big insider bets being placed within hours of
| the event actually occurring? The insiders are doing the
| equivalent of bid sniping -- waiting until the last possible
| moment to exercise.
|
| This is how inside info works in trading markets in general.
| And again this is inevitable and by design.
|
| It also makes them largely useless, because the timeline for
| which useful position is shared is compressed to the point
| where nothing useful can be gleaned from the information.
|
| The thing is a "lie incentiviser" -- a market entirely for
| suckers. That's why 95% of volume is sports betting.
|
| That's setting aside insider positions having an influence on
| the outcome of events which is a whole separate problem.
| crazygringo wrote:
| > _Why are these big insider bets being placed within hours
| of the event actually occurring?... It also makes them
| largely useless_
|
| They're not, usually. The more the outcome seems unlikely
| at first, the more you're incentivized to place your big
| bet _earlier_ , when the odds seem worse, because you'll
| make a ton more money.
|
| When these bets are placed only a few hours beforehand,
| that's often because the actual decision hasn't actually
| been _made_ until then.
|
| And there are plenty of areas where having notice of an
| hour or two is still hugely vulnerable.
| tyre wrote:
| Yes and no.
|
| If you see prediction markets as how they were originally
| pitched (price ~approximating likelihood), then insider trading
| is good. It provides discovery.
|
| If you look at what prediction markets are today (gambling,
| especially on sports, especially in states that have banned
| it), then insider trading is bad. Particularly when the people
| trading can influence the outcome (e.g. a pitcher purposefully
| throwing into the dirt.)
| idiotsecant wrote:
| Of course. The point is not to make individual players money
| (that does sometimes happen as a side effect) it's to leverage
| their greed to find truth.
| ambicapter wrote:
| Except it's not "truth" as much as it is whatever has the
| most financial incentive to happen.
| idiotsecant wrote:
| To some approximation, the two are the same.
| MarceliusK wrote:
| Prediction markets are probably most "accurate" when at least
| some participants have genuinely superior information
| rapind wrote:
| Bad leaders get bad followers.
| helsinkiandrew wrote:
| Interestingly Kalshi has 'banned' insider trading, whilst
| polymarkets often tweets that some of their users must have
| inside information
|
| https://news.kalshi.com/p/kalshi-trading-violation-enforceme...
|
| https://x.com/polymarketmoney/status/2001056273500954784?s=4...
| Analemma_ wrote:
| Manifold actually explicitly encourages insider trading,
| arguing that it leads to more accurate pricing. This was
| possibly defensible back when it was a cute funtime project run
| by a Bay Area polycule, but it's probably going to get them in
| deep shit sooner or later, even though they don't even use
| real-money betting.
| sir0010010 wrote:
| Though Manifold only uses their non-withdrawable play
| currency Mana.
| cc-d wrote:
| The SEC only exists for dad to frame people.
|
| The vast majority of insider trading schemes are not
| prosecuted, many leave no evidence trail at all without going
| deep into black-op classified territory.
| tyre wrote:
| Prediction markets are regulated by the CFTC in the US.
|
| Your point stands, for now at least, since the CFTC seems
| entirely uninterested in prosecuting or regulating.
| cc-d wrote:
| Thanks for making me aware of another federal agency :)
|
| Seems to me prosecuting or regulating this sort of
| activity is futile, and pretty much serve only the
| interests of the mob. These markets make additional data
| open source, which otherwise might exclusively belong
| only to mob, so that's pretty cool. We democratized
| buying airstrikes.
|
| It You may know how bad things really are, but if you
| don't, the lawboys are pretty much just playing pretend
| at this point, and have been for a while.
|
| Mob wants me to add: if you try to buy an airstrike with
| our very based and functional cryptocurrency systems, you
| will probably just find mob. We have mob priced in,
| anybody with a significant amount of cryptocurrency knows
| this too.
|
| It's not as simple as "buy an airstrike" comrade (we are
| referencing the person writing this post)
| seydor wrote:
| I can't believe these markets are still legal
| morkalork wrote:
| Why would Washington ban their staffers' bonus program?
| senkora wrote:
| EDIT: I am wrong, see children
|
| > The employee, she said, "used confidential OpenAI information
| in connection with external prediction markets (e.g.
| Polymarket)."
|
| Note that "insider trading" is not illegal on prediction markets.
| The particular issue here is that the employee "disclosed"
| confidential information on a public forum by influencing the
| prices assigned to certain outcomes by prediction markets.
| agency wrote:
| I don't think this is true, though enforcement is another thing
| and the standard is different than in securities markets.
| Prediction markets are regulated by the CFTC and the insider
| trading standard is "misappropriation of confidential
| information in breach of a pre-existing duty of trust and
| confidence to the source of the information" (vs any "material
| non-public information" for securities)
| https://www.cftc.gov/PressRoom/SpeechesTestimony/phamstateme...
| qoez wrote:
| It is most definitely against the rules of the sites and
| illegal, especially on kalshi
| 7777777phil wrote:
| 77 suspicious positions across 60 wallets, 13 brand-new accounts
| appearing 40 hours before the browser launch. First confirmed
| case of a major tech company firing over prediction market
| trades.
|
| I wrote about why prediction markets have a structural insider
| trading problem that nobody's solved yet:
| https://philippdubach.com/posts/the-absolute-insider-mess-of...
| throwaway5752 wrote:
| Prediction markets exist to bypass gambling restrictions and
| monetize insider trading. It isn't a problem, it is their
| raison d'etre.
| gtowey wrote:
| Jinx!
| juleiie wrote:
| Yeah but someone has to give the money to the insider
| traders.
|
| Betting and insider gambling wouldn't work if people were
| educated and just didn't gamble and so never used these
| platforms in the first place.
|
| It's an old question of whether government is responsible to
| protect people from themselves or should we give everyone
| freedom to go bankrupt in this specific way if they so
| desire.
|
| I don't know if there is a healthy way to gamble really. With
| drugs and substances at least there is some continuous
| spectrum but you either gamble your money or not.
| logicchains wrote:
| >I don't know if there is a healthy way to gamble really.
|
| The majority of gamblers keep it within limits, only a
| small minority lack that control and inevitably end up
| impoverishing themselves.
| juleiie wrote:
| The majority of people can't even control their daily
| screen time, yet we are supposed to believe they can
| masterfully restrain their urges when money and dopamine
| are on the line? Nothing I've seen indicates human
| impulse control is that bulletproof. Furthermore, the 'I
| have it under control' narrative isn't proof of a healthy
| habit; it's practically the universal slogan of active
| addiction.
| somenameforme wrote:
| Many, I suspect the overwhelming majority, of the markets
| are impossible to engage in insider trading in. So it's
| genuinely just an interesting way to monetize expertise.
| Chess is a great example. A lot of the money in that market
| is people turning on the latest chess engines and betting
| in accordance to position evals, but skilled players can
| see much more - like how a position that the computer gives
| as a dead drawn is, in reality, extremely difficult for one
| side to hold. So the market might give near 50% when it's
| perhaps more like 65/35. That's quite a large edge. There's
| also quite a lot of opportunities for arbitrage betting,
| which is by definition risk free.
| somenameforme wrote:
| Would you not say that somebody could equally cynically
| describe options trading in this way?
|
| Prediction markets are very valuable because they provide
| information on issues that's generally much more accurate
| than alternative sources, such as polls. For instance
| Polymarket predicted 94% of the results for the 2024 election
| a month out, including the presidential. It can also provide
| more information than the news. For instance the chances of
| Khamenei being out as Supreme Leader of Iran by March 31st
| just skyrocketed up to 78%. That tells me far more than the
| various news sites minute by minute coverage.
| throwaway5752 wrote:
| Help me understand the relatively regulatory frameworks
| around each activity.
| ThePowerOfDirge wrote:
| Gambling = investing. Buying stocks is also gambling. Share
| buybacks, dividends, fancy words for forking money from
| workers to some joe schmoe that bought a lottery ticket,
| i.e., a stock.
| tjwebbnorfolk wrote:
| A stock is ownership in a business, same as ownership in a
| house. It is an asset that you own.
|
| When you bet on blackjack or the superbowl, you own nothing
| and are simply wagering on the outcome of an event.
|
| Gambling and equity ownership are not the same.
| dilyevsky wrote:
| There's more to stock trading than just "buy and hold".
| Not all investing has gambling motivations but it is
| absolutely used as gambling tool by many
| gtowey wrote:
| Insider trading is the raison d'etre of these products.
| Hamuko wrote:
| Yeah, Polymarket is explicitly advertising this.
|
| > _Research shows prediction markets are often more accurate
| than experts, polls, and pundits. Traders aggregate news,
| polls, and expert opinions, making informed trades. Their
| economic incentives ensure market prices adjust to reflect
| true odds as more knowledgeable participants join._
|
| > _If you're an expert on a certain topic, Polymarket is your
| opportunity to profit from trading based on your knowledge,
| while improving the market's accuracy._
|
| You know what's a great knowledgeable participant? An
| insider.
| gtowey wrote:
| I have come to the opinion that every successful tech
| company is basically just an arbitrage scheme to avoid
| regulations and extract value based on that advantage.
|
| Airbnb for unlicensed hotels. Uber for unlicensed taxis.
| Amazon for whitewashing fraudulent products. Bitcoin for
| unlicensed securities and laundering money.
|
| The pattern is upsetting.
| logicchains wrote:
| From an economic perspective the majority of those
| regulations destroy economic value and those companies
| are unlocking value by finding clever ways around them.
| gtowey wrote:
| No, they just shift the economic downsides to someone
| else so they can collect the difference. That's what I
| mean by arbitrage. Someone always pays the price, and now
| it's you and I.
| Imustaskforhelp wrote:
| I agree, once they have bypassed regulations, they use
| that to essentially rent-seek from their monopoly/their
| unique position where the rent is paid by us public.
|
| Their behaviour is very rent-seeking imo and at moments
| like these, its best to remind us that even the father of
| Capitalism, Adam Smith didn't like landlords
|
| Had to search up some quotes from adam smith right now
| but here's a relevant one (imo) to this discussion:
|
| "[the landlord leaves the worker] with the smallest share
| with which the tenant can content himself without being a
| loser, and the landlord seldom means to leave him any
| more." - Adam smith
| holmesworcester wrote:
| That's not always true. Regulations increase the cost of
| transacting and make ranges of transactions non-viable,
| just like a tax.
|
| So there is "dead weight loss", where transactions that
| would have been mutually beneficially and socially
| productive are eliminated by the regulation, and restored
| when somebody finds a loophole, restoring the individual
| and social benefit.
|
| The world is not zero sum!
| Imustaskforhelp wrote:
| I can't say this for the companies listed above but
| atleast within the realm of social media, they also want
| to bypass regulations and well, we all know how's it
| going.
|
| On a long term, I do feel like there will be a drop in
| producitivity, thus destruction of economic value because
| of lack of enforcement of policies/such companies having
| reckless attitude about them.
|
| Many of the products listed above actually seem to be
| very rent-seeking in my opinion (IIRC Someone on HN once
| said that from their personal experience talking to
| drivers, uber takes an approximate at the very least 40%
| cut or more)
|
| (This might be a little off-topic?_ but one thing I think
| about tech regulations is that Facebook used to see if a
| young girl/minor girl took a selfie and then if they
| don't upload it, detect that she was insecure and then
| try to show them face beauty recommendations.
|
| These girls can be our sisters/daughters fwiw. Facebook
| profits from insecurity/rage-bait and I would say that
| many social medias are the same as well, its just that
| the facebook example to me feels so eggregious and should
| be a uniting front for many to agree that there's a
| problem indeed.
|
| You will be right when you say economical value is
| generated from profiting from insecurity/bypassing
| regulations but at what cost?
| Natfan wrote:
| i can find clever ways around d crippling debt, its
| called robbing a bank at gunpoint
| parineum wrote:
| That's what happens when the majority of people don't
| actually support the regulations.
|
| If people thought it was wrong to be an unlicensed airbnb
| or uber, they wouldn't use them. In reality, those
| regulations are mostly protection rackets and most people
| don't care about violating them.
| lokar wrote:
| People were (and mostly still are) very opposed to Airbnb
| rentals in their neighborhood.
| aleph_minus_one wrote:
| ... but the customers of these Airbnb rentals are not.
| :-)
| jquery wrote:
| People support anti-pollution measures yet corporations
| still choose to pollute. Curious.
| iso1631 wrote:
| People whose houses are robbed are against robbery,
| people who rob houses are very much for it.
| vlovich123 wrote:
| That's a false analogy.
|
| You have two parties who want to enter into a contract
| and a third party unrelated to the contract that doesn't
| for whatever reason. Just based on contract law and
| common sense the unrelated party shouldn't have standing.
| Now if there's externalities to the contract that impact
| that unrelated party sure, but only insofar as to get
| those externalities addressed.
|
| This is not the same as a robbery which involves no
| contract or a willing counterparty to the robbery.
| lokar wrote:
| Yeah, IME, if the guests of the rental acted exactly like
| locals, and the units were not removed from the local
| housing supply (not sure how that could be), or the local
| housing supply was in excess to the needs of the
| population (not sure where that is), it would be fine.
| ajkjk wrote:
| that's the point of the regulations...
| parineum wrote:
| That's none of their business.
|
| There are already laws in place against the kinds of
| behavior that neighbors are afraid will happen.
| lokar wrote:
| Noise, litter, etc, "nuisance" laws are on the books, but
| mostly depend on people following them voluntarily. The
| local authorities don't have the time/staff to
| investigate and resolve them all the time.
| gtowey wrote:
| I disagree. When you give people strong economic
| incentives to ignore morality, some people will. Not all,
| but enough to make a hash of things. In any population
| there will be some people who will do things they know
| are wrong just to get ahead.
|
| For Airbnb landlords I'm sure the thought process goes
| like " I'm just one person so I can't be having enough of
| an impact to be a problem. And besides, I _need_ the
| money. " But then enough people pile on and in aggregate
| they ruin the local housing market. But nobody thinks
| that they themselves are culpable
| twoodfin wrote:
| I'm struggling to understand the moral character of taxi
| service regulatory capture and monopolization.
| tstenner wrote:
| Your taxi crashes because the driver skipped brake
| maintenance and his insurance doesn't reimburse you for
| your hospital costs because commercial transportation
| isn't covered. Sure would be nice to have some minimum
| requirements for taxis.
| twoodfin wrote:
| If maintenance schedules and insurance regulations are
| "moral" issues, what isn't?
| jquery wrote:
| This is certainly the most uncharitable way to think
| about it.
|
| I see a prisoner's dilemma where people often support
| regulations even if on an individual basis they would
| personally violate them, because they prefer living in a
| the less chaotic society. For example anti-dumping
| regulations... the expected value for any given
| individual is +EV, but when everyone is dumping, it's a
| big -EV
| jacquesm wrote:
| The perfect example is speed limits: everybody thinks
| they're good and yet they all seem to classify all other
| drivers into two categories: slowpokes and maniacs.
|
| Nobody seems to be able to agree on what a responsible
| set of rules is around the speed of vehicles.
| ajkjk wrote:
| This is entirely made up? Most people are totally fine
| with speed limits being what they are and don't say
| anything about it.
| jacquesm wrote:
| Oh, that explains the massive difference in speed limits
| from one country to another then, especially if they're
| next door neighbors.
| JasonADrury wrote:
| In the sense that they don't care what the sign says when
| it comes to their own driving? Sure.
| yuliyp wrote:
| That's because they are slowpokes and maniacs: In a
| decently flowing road, the majority of distinct cars you
| see are either moving significantly faster or slower than
| you (and the more extreme the difference the more likely
| you are to see them). Of cars that go at a similar speed
| to you, they approach you / you approach them more slowly
| so you'll see fewer of them.
| BostonFern wrote:
| That's interpreting a failure to fight to preserve ethics
| as an internal rejection when it could be explained by a
| lack of fighting spirit, either because the fight seems
| impossible or the given hill not worth dying on. Another
| interpretation would be a comfort-oriented, avoidant, and
| possibly cynical culture facing a power imbalance.
| ajkjk wrote:
| that can't be right. If 90% of people are anti-airbnb and
| the other 10% are pro-airbnb then the 10% just open all
| the airbnbs.
| staplers wrote:
| Bitcoin is not a company
| fsckboy wrote:
| > _Yeah, Polymarket is explicitly advertising this_
|
| no, they are not.
|
| you might have been an insider working on the Apple Newton,
| and being enthusiastic about it you might have broken the
| rules and traded on your "knowledge"... and you would have
| lost your shirt. Same with your very knowledgeable
| enthusiasm about myriad other technologies. Ever wonder why
| Wall St doesn't show up at HN asking everybody's opinion
| about AI in order to leverage that info into billions?
|
| an important element of "the wisdom of crowds" is many bits
| of microknowledge. How many Teslas will be sold next year
| is very dependent on how much the people who buy Teslas
| will earn next year (or how secure they will feel in their
| jobs) _working in myriad other industries that have nothing
| to do with Tesla_ , along with the price of lithium, tires,
| and even ... wait for it... gasoline.
|
| Polymarket's words you quote can just as likely refer to
| the wisdom of crowds. Or even, and this is the subtle part:
| Polymarket's insiders may believe, like you, that they are
| creating a market to trade on inside information, and yet
| they, like you, could be made wrong by the superior sum
| knowledge of the crowd exerting its invisible hands all
| together to tank your Apple Newtons.
| pigeons wrote:
| >Yeah, Polymarket is explicitly advertising this
|
| Yes they are. Polymarket has an ad glorifying a
| "fictional" scenario where someone gets a job as a
| janitor in a video game company to bet on related events
| in polymarket
| holmesworcester wrote:
| Isn't insider trading on a prediction market only wrong to
| the extent the insider is violating some duty of secrecy to
| the company?
|
| And isn't that just between them and their company in a case-
| by-case sense?
|
| If there was some valuable-to-the-public information that the
| company did not care about keeping private but just hadn't
| bothered to make public, for whatever reason, and an insider
| traded on it on a prediction market, that would only benefit
| the public's interest in information and would not violate
| any duty to the company. It'd be a pure win for everyone.
|
| It seems unfair to other traders, the way it would be in the
| stock market, but in prediction markets (unlike the stock
| market) all participants are _explicitly_ taking on the risk
| that somebody else might have better access to information
| than they do. So it 's not subverting the system in the way
| we have decided it does in stock markets.
|
| A lot of commenters are getting the wrong take here by
| looking at this like it's a stock market where there is some
| society-level interest in giving participants protection from
| having less information than insiders. It's just a different
| thing.
| gtowey wrote:
| The thing is you're still thinking of these insiders as
| someone who just got a juicy stock tip from a relative.
|
| The much more serious problem is when these insiders
| actually have their hands on the levers which decide the
| outcome. It's really no different than a mobster who bets a
| bunch on money on an unlikely outcome then threatens one
| side to throw the match.
|
| What possible economic benefit is there to society to allow
| ordinary people to bet in markets like that?
|
| Would you really like to live in a world where "Will we
| nuke Iran?" Is a bet you can make? Then someone in
| government sees how much money they could make if they bet
| yes & push the button?
| tgsovlerkhgsel wrote:
| This is the entire idea behind the concept of
| "assassination markets" - "prediction" markets on
| assassinations that are just thinly veiled ways to
| crowdsource murders by taking bets that you expect to
| lose against an "insider" (the killer).
| parpfish wrote:
| It doesn't need to be as high stakes as assassination.
| Any public figure could have a free-money loophole with
| all the stupid bets on things like whether a certain word
| would appear in a speech.
|
| If I were famous I could start a pool betting on whether
| I would post a picture of a my lunch this week. I could
| stake whichever side has the biggest payout and then just
| make it happen
| slg wrote:
| And we already have laws against this stuff when it is
| traditional gambling. For example, a couple MLB
| players[1] are currently facing 65 years in prison
| because they would occasionally waste a pitch at the
| directions of gamblers netting them a few thousand
| dollars each time they did it. For those not familiar
| with baseball, a starting pitcher generally throws
| between 80-100 pitches a game and a reliever throws
| roughly 10-30. This is basically as low stakes as a
| sports bet can get, so it makes it all the more
| attractive to attempt because it feels less like a
| compromising of morals with the less the participant
| actually needs to sacrifice.
|
| These prediction markets are now giving even more people
| the opportunity to make a small ethical compromise in
| exchange for non-trivial amounts of money without any of
| the potential legal repercussions of traditional markets
| or gambling. That type of ubiquitous corrupting influence
| can't be good for the health of society.
|
| [1] - https://www.cbssports.com/mlb/news/guardians-
| closer-emmanuel...
| jacksnipe wrote:
| Futures contracts were a mistake, god damn
| MarceliusK wrote:
| I think this is mixing up two different things: influence
| and knowledge
| tyre wrote:
| > Isn't insider trading on a prediction market only wrong
| to the extent the insider is violating some duty of secrecy
| to the company?
|
| Yes.
|
| Prediction markets, for corruption reasons, are regulated
| by the CFTC. In commodities markets, actors are _assumed_
| to be making trades based on propriety information. Hedging
| is the whole purpose!
|
| > ...like it's a stock market where there is some society-
| level interest in giving participants protection from
| having less information than insiders.
|
| Ah, no!
|
| Insider trading in the stock market is (usually) only
| illegal in your first case: when the person trading is
| violating confidentiality.
|
| _It is not about fairness._
|
| Fairness is a poor proxy for whether specific trading is
| illegal.
|
| For example:
|
| If a company accidentally leaves a press release for a
| merger publicly available, I happen to guess the URL, and
| then I trade on it: Unfair (I have access to insider
| information that other market participants do not) but
| legal!
|
| If I work at the company, am sent the press release to copy
| edit, and then trade on it: Illegal. I have a duty to the
| company not to trade on it.
| jstanley wrote:
| I don't think your example refutes the fairness heuristic
| at all.
|
| The first case is completely fair because anybody else
| could have done the same thing without any special access
| required.
|
| The second case is unfair because you had to work at the
| company to get access.
| tyre wrote:
| Okay, then imagine you overhear at a bar. Yes "anyone
| could have" theoretically, but not actually. In either
| case, you have material non-public information that your
| counterparty in the market does not.
| j16sdiz wrote:
| you got that piece of non public information was not
| because you are an insider. As long as the bar is not
| exclusive to insider, i don't see any difference
| cortesoft wrote:
| Isn't it exclusive to people who live in the area of the
| bar?
|
| What if the bar has a cover charge, so only those who pay
| get in?
|
| What if the cover charge is $10,000 and the bar is
| advertised as "the place where public company execs love
| to come talk to each other about private deals"?
| j16sdiz wrote:
| > I happen to guess the URL, and then I trade on it:
| Unfair
|
| I can argue it is fair - anybody can try guessing the
| url, you don't have to be an insider to guess it
| ambicapter wrote:
| > I have a duty to the company not to trade on it.
|
| To the company? Or to the stock market, as a participant
| in it?
| tmp10423288442 wrote:
| Your comment seems to imply that trading based on
| material non-public information in prediction markets is
| always okay, which is not the case. The CFTC just made a
| press release detailing some instances of invalid use of
| nonpublic information on prediction markets:
| https://www.cftc.gov/PressRoom/PressReleases/9185-26
|
| Interestingly, the CFTC objects to a political candidate
| trading on their own candidacy on the grounds that it is
| fraudulent. So it looks like they could attempt to
| regulate self-trading quite strictly, at least if that
| theory holds up after a court challenge.
| victorbjorklund wrote:
| >> If a company accidentally leaves a press release for a
| merger publicly available, I happen to guess the URL, and
| then I trade on it: Unfair (I have access to insider
| information that other market participants do not) but
| legal!
|
| Not necessarily. Just because you accidentally left your
| S3 bucket open and I brute force my way to the link by
| guessing doesn't make it legal. It can still be insider
| information. Insider information is not limited to people
| who have a duty to the company. If I break into the
| companies office and steal information and trade on it
| then it can be insider trading.
| flessner wrote:
| No, commenters here simply take into account that
| predictions markets have historically classified themselves
| as futures markets and not as gambling.
|
| Allowing information asymmetry, like insider trading,
| undermines the regulatory argument that keeps these markets
| legal.
| vkou wrote:
| The insider has perverse incentives as an employee.
| tossaway0 wrote:
| I'm probably overlooking something, but if you have
| insider info, you just bet on that info with certainty.
| Why would you need to create a different outcome to bet
| on it?
|
| If I know my company is going to do something on March
| 16th, I can bet against it happening until that day, and
| then bet big it will happen that day. I don't need to
| influence the company to change what it's going to do to
| make money on it.
| agons wrote:
| The problem comes when there are lucrative odds for some
| unlikely scenario, which you can influence into
| realisation, and that outcome might be counter to the
| company's goals (i.e. sabotage)
| SpicyLemonZest wrote:
| I think there is a society-level interest. It's very bad
| for the business environment if every employee of every
| company has monetary incentives to leak private
| information. It structurally encourages businesses to set
| up strict information silos where cross-team collaboration
| is hard no employee can ever be sure of the broader context
| of their work.
| MarceliusK wrote:
| In theory maybe, but in practice companies almost always do
| care about keeping things like release timing, product
| status or leadership decisions confidential. Even if they
| haven't publicly announced a policy about prediction
| markets specifically, it's usually covered under general
| confidentiality and acceptable use policies
| datsci_est_2015 wrote:
| Could also make a case for incentivizing destructive actions
| by insiders as well. You're saying I could sabotage my
| project and make a quick buck?
| sigmoid10 wrote:
| That's basically what the current US admin is doing.
| ekjhgkejhgk wrote:
| Excuse me it's called price discovery.
| ohyoutravel wrote:
| Archived version: https://archive.ph/XWrTA
| raincole wrote:
| It's interesting that the both replies under this comment are
| saying exact same thing, with the exact same term ("raison
| d'etre"... how often do you hear two random people think of
| this phrase at the same time?).
|
| It might be nothing, but it'd be funny if karma farming bots
| are doing some 'reply frontrunning' over the internet.
| kennyadam wrote:
| I don't consider "raison d'etre" a suspicious phrase. It's
| not something people use multiple times a day, but I'd
| consider it common enough that when I hear someone say it, or
| in this case I suppose type it, that I would give it a second
| thought.
| Rexxar wrote:
| I don't think that two 13 and 14 years old accounts with not
| that many comment per week are bots.
| croes wrote:
| Prediction market, either gambling or inside trading.
| Havoc wrote:
| Good.
|
| I do hope corporations in general take a harder stance on this.
| From a society perspective people with inside knowledge fleecing
| randoms is not a win. We've got that somewhat under control on
| the stock exchange, but have this absurd situation where on
| prediction markets it is a free for all and everyone pretends
| this is fine.
|
| I also think corporations should distance themselves from
| individuals willing to fleece randoms. Trading in general is very
| wild west survival of the fittest but active exploitation of
| insider knowledge speak of very poor morale character
| strix_varius wrote:
| Honestly it seems stupid but fine to me. Like if someone random
| comes up to me on the sidewalk and says hey if OpenAI announces
| a browser tomorrow, you give me $100. If not I'll give you
| $1000. Obviously I'm not going to take them up on it, they
| clearly have inside information.
|
| If you're betting on a prediction market without insider
| information then you're just... The fool who is soon parted
| from his money one way or another.
|
| I generally feel like people should be free to do whatever
| insane stuff they want with their own lives.
| clcaev wrote:
| > I generally feel like people should be free to do whatever
| insane stuff they want with their own lives.
|
| The problem with people doing insane stuff with their "own
| money" is the burden they often exact on their family or
| society.
|
| Perhaps the realm of independence starts when loans are
| reasonable and current, there is sufficient child support,
| and they are meeting a base savings rate for their
| retirement.
|
| Speaking of which, perhaps any UBI could also use a minimal
| criteria, reviewed annually but without any barriers on first
| year eligibility.
| Havoc wrote:
| >Like if someone random comes up to me on the sidewalk and
| says hey if OpenAI announces
|
| Then you hopefully understand that randoms approaching you is
| no equal to reality.
| MengerSponge wrote:
| Wouldn't those prediction markets be more efficient if positions
| were associated with people's real names?
|
| Like, a 100k wager from a finance dude carries some information,
| but a 10k wager from a staffer says a lot more!
| peterjliu wrote:
| I mentioned a potential OpenAI insider in
| https://x.com/peterjliu/status/2024901585806225723, that was from
| 5 minutes of investigation. There are probably more. And then
| there's a lot of other companies.
| ddp26 wrote:
| Prediction markets are interesting when they are predicting
| future things nobody knows for sure.
|
| "Predicting" private, known information is the wrong use case.
| mrkramer wrote:
| Inside trading on the public market and on the public blockchain,
| that's smart!
| shevy-java wrote:
| We can not trust these AI corporations and organisations.
| djohnston wrote:
| that's right prole! only Congress has that privilege!
| blindriver wrote:
| I find it absurd that someone can create an unregulated market
| like Kalshi, and then all of us need to be beholden to it, even
| though the idea is stupid. How is it possible that someone can
| create a product that none of us agree on, and now everyone else
| has to conform to the rules around it because of the problems
| that it creates. I would rather Kalshi get shut down than the
| precedent of allowing this to control employees or people.
| MarceliusK wrote:
| Makes you wonder how much "market accuracy" on these platforms is
| actually just leakage
| rohitpaulk wrote:
| Two questions I'd have expected the article to answer:
|
| (a) how did they identify the employee, and (b) how come they
| weren't sent to jail
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