We are quickly discovering that “financializing everything” through prediction markets also creates endless opportunities for corruption.
What happened: Last month, according to maps maintained by a D.C. think-tank, Russian troops captured Myrnohrad, triggering a payout to a group of Polymarket users who had bet the town in eastern Ukraine would fall by November 15.
Only, the maps were wrong. The town never fell; Ukraine controls it to this day.
What actually happened: A staffer at the Institute for the Study of War (ISW) made an unauthorized update to a map of the front lines in the conflict showing the town had fallen, according to an ISW statement. That map was then used as proof to resolve the market on Polymarket, raising the (very likely) possibility that the staffer made the edit in order to (fraudulently) resolve the market in their favour.
Zoom out: Other examples of dodgy happenings on prediction markets from last week alone include apparent insider trading on the performance of new AI models and a likely leak of TIME’s 2025 Person of the Year (whether it leaked or not is now also something you can bet on).
Why it matters: The growing popularity of — and opportunity to profit from — prediction markets is creating incentives to impact events in the real world and do things (like insider trading) that would be crimes if they were done to profit in the stock market. Not so in the almost entirely unregulated world of prediction markets.
Our take: Prediction markets are just one way the impulse to gamble on everything — whether it's meme stocks or sports or crypto — is taking over our society. It’s not for this humble newsletter to judge whether that’s healthy or not, but we need to try to understand why it’s happening.—TS