Off the Record: Prediction markets, plastic straws and the new panopticon
We could have been sitting on the banks of the Euphrates eating figs. That is, until someone got the bright idea to maximise shareholder returns. Now, we sit in web browsers making wagers as to when exactly the current round of bloodshed in nearby waters will come to an end.The stock market has long drawn criticism from those on the outside who view it as an economic machine ruled by investor sentiment and untethered to everyday life. Guy Debord offers us a critique of this estrangement in his The Society of the Spectacle. Debord posits that “the society which rests on modern industry is not accidentally or superficially spectacular, but fundamentally spectaclist. In the spectacle, the goal is nothing, development everything. The spectacle aims at nothing other than itself.”Yet one could still argue that the stock market is not pure spectacle. However distorted it becomes, it still retains a material tether. Well-functioning secondary markets help capital flow toward productive uses and are only made possible by real people spending real dollars. However imperfect, the market is still connected to its people.Enter, prediction markets. While the stock market still attempts, or appears, to serve production, prediction markets don’t even bother, instead monetising anticipation itself.If you have managed to remain blissfully unaware, prediction markets allow users to trade on the likelihood of future events. Bets on the platform range from issues like Strait of Hormuz traffic returns to normal by end of April? What will Trump say in April? Will the US confirm that aliens exist by…?The object of exchange is the event itself as a probability. It’s a market solely concerned with hype, or as Polymarket would call it, wisdom.Polymarket Note on Middle East Markets: The promise of prediction markets is to harness the wisdom of the crowd to create accurate, unbiased forecasts for the most important events to society. That ability is particularly invaluable in gut-wrenching times like today.I first heard of prediction markets when US Rep. Ilhan Omar was attacked during a town hall meeting. Online, people were betting on the substance that was sprayed on her. Now, traders bet on missile strikes in Iran and insults flying out of Trump’s mouth.Proponents of prediction markets argue that they aggregate dispersed information into forecasts about uncertain future events. Even where they are reasonably accurate, what they trade is not an enterprise producing goods or services, but an anticipated outcome.Unsurprisingly, prediction markets have begun to elicit bouts of paranoia. For the market, insider trading and corruption are major concerns. For me, the concern is the grotesque estrangement of real people from tragedy as we load currency onto spectacle with little concern for impact. On Polymarket, crises are no longer lived realities; they are odds to watch and positions to take.Proponents of prediction markets argue that a major benefit could be derived in the form of an aggregated universal truth. By engaging individuals across the world from different stations, beliefs and backgrounds, diverse and dispersed information is synthesised, and users are delivered a supposedly more accurate probability for any given situation. Rather than relying on news sources, investors, politicians or other figureheads, a broader swath of public opinion is accounted for, adding more data and insight to the probability equation.Polymarket Note on Middle East Markets continued: After discussing with those directly affected by the attacks, who had dozens of questions, we realised that prediction markets could give them the answers they needed in ways TV news and X could not.This, however, relies on incentivised truth-telling. Prediction markets hope that because individuals are financially motivated, they will place bets that align with their true beliefs. But conflating belief with truth does not produce accuracy. According to Polymarket, there is a 4% chance Jesus Christ will return before 2027.But it looks like prediction markets will miss their chance to disperse those fears, as they have already been undermined by corruption.US-based trading app Robinhood has reportedly begun excluding some prediction market contracts, with Robinhood UK president Jordan Sinclair saying the company is “very focused on market abuse, insider trading”.Remember when Trump issued his warning on Truth Social that “a whole civilisation will die tonight”? If I had taken a temperature check of public opinion at that moment, I would say the majority thought we were inching towards a point of no return rather than a ceasefire. There was even a countdown.And yet, just before the ceasefire was announced, newly created Polymarket accounts made highly specific bets on the outcome, resulting in hundreds of thousands of dollars in profits. The Associated Press reported that at least 50 wallets placed substantial bets before Trump announced the ceasefire, and that these were the first bets made by those wallets.This isn’t confined to Washington, either. In February, two Israelis were charged over alleged bets placed using classified military information, and later that month, Kalshi accused a MrBeast video editor of insider trading on markets tied to the YouTuber.The impacts aren’t only reactive, either. In March, a Times of Israel reporter said Polymarket users sent him death threats and pressured him to amend his report on a missile strike near Jerusalem which became central to a wager on the site.Beyond investor corruption, the real scandal of prediction markets is not just that they let people bet on the future, but that they sit within a culture that monetises crisis while moralising individual behaviour. A culture that turns public life into persona, sentiment and price. Governments increasingly redirect attention from corporate and structural responsibility to everyday conduct. Individuals are named and shamed for using plastic straws, eating meat, driving to work or consuming too much, while billion-dollar industries burn through fuel at scales beyond personal comparison.Last week, the Federal Government was in the hot seat over its ‘Every little bit helps’ campaign, a fuel-saving advertising push costing up to $20m and encouraging Australians to use less fuel where possible. Some cried out that it was like plastic straws all over again. But the idea was still valid: individual consumption of our resources is a beast worth taming or at least keeping an eye on.But the question remains: what about the industries using billions of litres of fuel each year? What about inadequate public transport systems that make commuting to low-paid office jobs inseparable from car dependence? What about the fact that the government, which wants us to believe its hands are tied, is one of the few actors with any meaningful power over the fuel crisis, and at least some responsibility for it?The problem is not that individual restraint is meaningless. It is that personal consumption is positioned as the moral centre of crisis management, while the larger systems shaping the crisis remains immune to scrutiny. Disjointed public transport, corporate fuel dependence and state policy failures do not disappear just because individuals are told to tighten their belts.At the pump or on Polymarket, we grasp at paper straws, hoping to grab a bit of control over our circumstances. The ugliness of this system is not only that tragedy can be watched and traded at a distance, but that responsibility for fixing the social breakdown behind conflict is then handed back to individuals as a series of choices. All the while, we are left completely disconnected from any real locus of control.Debord calls this the alienation of the spectator: the more you contemplate, the less you live. The estrangement is a surrender of our own lives. And when the stakes are high enough, it’s a surrender of our own humanity for the chance to make, or save, a quick buck.Luckily for those of us in Australia, prediction market platforms, much like single use plastic, are functionally banned.Off the Record is The Australian Mining Review’s weekly column.
