The Crypto Conversation The Information Market - Polymarket lets traders bet on real-world events
Shayne Coplan is the founder of Polymarket, an information markets platform. Speculators can bet on the world's most highly-debated topics like the upcoming US elections, COVID-19, DeFi, cryptocurrencies, and more.
Guest:Shayne Coplan
Why you should listen:In 2014 Coplan was a teenager interested in music, technology, and the peer-to-peer file sharing scene. He had started mining crypto assets like Litecoin using the early GPU miners. When the website for the Ethereum presale went live he became inspired by the Ethereum vision and at 16 years old, Coplan was one of the youngest participants in the Ethereum presale. "It seemed really cool to me. I didn't have a lot of capital to put into it but it was really exciting and it has been fantastic to be part of the journey so far."
Prediction markets are exchange-traded markets created for the purpose of trading the outcome of events. They date back to the 1500s and started as simple bets. Some forms of information markets such as dead pools or assassination markets are part of the Cyberpunk literature.
Polymarket is an Information Markets platform built on Ethereum. Speculators can harness the power of free markets to bet on the outcome of real world events. Coplan says, "I've always loved markets. I'm a fan of liquid markets and I'm fascinated by shadow economies and different market structures. I'm a believer in markets as the most effective mechanism for aggregating information. I have a tough time believing everything I read in the media. I think a market is a much more reliable aggregator of truth. If you have a lot of different participants acting on their beliefs, a market is the best way we can distill that information into one equilibrium or signal."
Key takeaway:One of the problems with social media is a lack of accountability. Everyone has an opinion to share and there's not much downside to being wrong. This makes it hard for regular people to find out what's fact and what's fiction. 2020 has showcased just how bad the consequences can be.
Ploymarket thinks that one part of the solution is to let people bet on current events. Free markets are the best method of aggregating disparate information in real time (see: Hayek, stock market, EMH).
Coplan says "one of the best use-cases for a blockchain and a generalized smart contract platform is the ability to create markets on arbitrary topics that can be easily created, traded, and resolved. For a couple of dollars you can create a market on anything and avoid the bureaucratic risk that is inherent to creating these markets in the legacy financial system.
On Polymarket, speculators bet on future event outcomes and profit from accuracy. With all the conflicting 'expert' opinions on social media, Polymarket lets people put their money where their mouth is, have skin in the game, and profit from being correct.
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