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There are cash-based markets like Predictit where you could've made a similar bet. Predictit charges 5% withdrawal fees + 10% of profits, but if you expect a 1

There are cash-based markets like Predictit where you could've made a similar bet. Predictit charges 5% withdrawal fees + 10% of profits, but if you expect a 15% ROI, it's still profitable.

dragonwriter 6y ago
The fiat-based prediction markets tend to limit the number of people in a particular markets, the size of positions in the market, and a number of other aspects of the market in a way which make it difficult to seize apparent opportunities and to limit the possible returns from doing so, even before considering the way that their fees eat up returns.
- tialaramex 6y ago
  These limits are because the ones you're thinking of are research projects, not in fact betting markets (even though as an individual you can treat them as betting markets just fine). This makes them accessible (legally) to US residents. Betfair is a British gambling firm, and isn't a research project, when Betfair's "Did Donald Trump win the US presidential election?" and "Did Joe Biden win the US presidential election?" closed it had hundreds of millions of pounds of bets across those two questions. I got paid, as in I put cash in and a couple of weeks later more cash was paid out to my bank account when BetFair closed it, for knowing that Donald Trump did not win that election in December. It was even possible (though of course risky) to buy the lows and sell the highs as MAGA rallied when they thought the Kraken had been released, or when Rudy was going to prove everyone wrong, or whatever other nonsense. I was actually underwater for more than 50% of the two weeks between placing my "bet" and the cash returned, because MAGA were bidding up the "Donald Trump won" position even as it became increasingly obvious that they'd lose everything.
Kranar 6y ago
PredictIt didn't have this anomaly where Trump had a 15% chance of winning. After Georgia called the election the percentage went above 95%.
- rspeele 6y ago
  Oh, it definitely did. Maybe not to the same degree as the crypto markets (never looked at them), and there were certainly spikes this way and that, but you could get Trump NO cheaper than 90c well into December. The Texas v. Pennsylvania case getting swatted down by SCOTUS was probably the last of the cheap shares where it was worth depositing money just to play, but if you already had some money in your account it was worth taking the obvious bets all the way to the end. edit: went back and checked one of the markets to refresh my memory. Yep, check the 90-day chart. Dec 6 "NO" on a Republican win was only 84c! https://www.predictit.org/markets/detail/2721/Which-party-will-win-the-2020-US-presidential-election https://www.predictit.org/markets/detail/2721/Which-party-wi... edit2: here's another hilarious one. https://www.predictit.org/markets/detail/5554/Will-Donald-Trump-win-the-popular-vote-in-2020 https://www.predictit.org/markets/detail/5554/Will-Donald-Tr... Yep, "Will Trump win the popular vote" closed on Nov 24th while still trading at 8 cents. The popular vote. Jesus Christ. For reference he lost the popular vote by 7 million. I'd actually be curious to know if there was a crypto-market equivalent to that one, because I want to believe most of that pricing was due to PI's limits. For example, one Trump bettor maxing out his $850 limit of 7c shares, requires 14 Biden bettors maxing out $850 of 93c bets to be his counterparty. With a 5,000 trader limit that means that there might be just a handful of Trump-won-landslide bettors vs a few thousand No-he-didn't bettors with a lot more invested, all maxed out and unable to move the price further. But I don't know if that shook out differently in the crypto space with no limits.
  - Kranar 6y ago
    You are correct, thanks for providing those sources.

There are cash-based markets like Predictit where you could've made a similar bet. Predictit charges 5% withdrawal fees + 10% of profits, but if you expect a 15% ROI, it's still profitable.

dragonwriter 6y ago

The fiat-based prediction markets tend to limit the number of people in a particular markets, the size of positions in the market, and a number of other aspects of the market in a way which make it difficult to seize apparent opportunities and to limit the possible returns from doing so, even before considering the way that their fees eat up returns.

tialaramex 6y ago
These limits are because the ones you're thinking of are research projects, not in fact betting markets (even though as an individual you can treat them as betting markets just fine). This makes them accessible (legally) to US residents. Betfair is a British gambling firm, and isn't a research project, when Betfair's "Did Donald Trump win the US presidential election?" and "Did Joe Biden win the US presidential election?" closed it had hundreds of millions of pounds of bets across those two questions. I got paid, as in I put cash in and a couple of weeks later more cash was paid out to my bank account when BetFair closed it, for knowing that Donald Trump did not win that election in December. It was even possible (though of course risky) to buy the lows and sell the highs as MAGA rallied when they thought the Kraken had been released, or when Rudy was going to prove everyone wrong, or whatever other nonsense. I was actually underwater for more than 50% of the two weeks between placing my "bet" and the cash returned, because MAGA were bidding up the "Donald Trump won" position even as it became increasingly obvious that they'd lose everything.

Kranar 6y ago

PredictIt didn't have this anomaly where Trump had a 15% chance of winning. After Georgia called the election the percentage went above 95%.

rspeele 6y ago
Oh, it definitely did. Maybe not to the same degree as the crypto markets (never looked at them), and there were certainly spikes this way and that, but you could get Trump NO cheaper than 90c well into December. The Texas v. Pennsylvania case getting swatted down by SCOTUS was probably the last of the cheap shares where it was worth depositing money just to play, but if you already had some money in your account it was worth taking the obvious bets all the way to the end. edit: went back and checked one of the markets to refresh my memory. Yep, check the 90-day chart. Dec 6 "NO" on a Republican win was only 84c! https://www.predictit.org/markets/detail/2721/Which-party-will-win-the-2020-US-presidential-election https://www.predictit.org/markets/detail/2721/Which-party-wi... edit2: here's another hilarious one. https://www.predictit.org/markets/detail/5554/Will-Donald-Trump-win-the-popular-vote-in-2020 https://www.predictit.org/markets/detail/5554/Will-Donald-Tr... Yep, "Will Trump win the popular vote" closed on Nov 24th while still trading at 8 cents. The popular vote. Jesus Christ. For reference he lost the popular vote by 7 million. I'd actually be curious to know if there was a crypto-market equivalent to that one, because I want to believe most of that pricing was due to PI's limits. For example, one Trump bettor maxing out his $850 limit of 7c shares, requires 14 Biden bettors maxing out $850 of 93c bets to be his counterparty. With a 5,000 trader limit that means that there might be just a handful of Trump-won-landslide bettors vs a few thousand No-he-didn't bettors with a lot more invested, all maxed out and unable to move the price further. But I don't know if that shook out differently in the crypto space with no limits.
- Kranar 6y ago
  You are correct, thanks for providing those sources.