This is OT now, but in addition to the corruptive effects of traders influencing results they are betting on mentioned by mootothemax, another possible negative

This is OT now, but in addition to the corruptive effects of traders influencing results they are betting on mentioned by mootothemax, another possible negative externality is the conservative effect the prediction market would have on the traders. Eg. if you got a whole population to bet on the market, suddenly it is in the interest of the majority to uphold past predictions, thus making society resistant to change.