There's a paper somewhere on these kinds of markets for forecasting events. I hope someone can link to it.
I think Congress shut down funding for the research as they were worried it would become self fulfilling. Like if there is a $50M bet on some world leader being assassinated (or something horrible like that), that could put pressure that would lead to it occurring when it wouldn't otherwise.
"The media storm hit on July 28, 2003, when two senators (falsely) complained that we were planning to let people bet on individual terrorist attacks. The next morning the secretary of defense announced that FutureMAP was cancelled. In the intervening day, no one from Congress asked us if the accusations were correct, or if the more offending aspects could be cut from the project. DARPA said nothing. The next day, John Poindexter resigned, and two months later all IAO research was cancelled."
> Like if there is a $50M bet on some world leader being assassinated
Such bets would be (and are) obviously not allowed, so this isn't an argument against prediction markets in general.
But unfortunately they are indeed banned in the US, which prevents them from becoming mainstream. They have a lot of big potential applications. I recommend this article for an overview:
I think Congress shut down funding for the research as they were worried it would become self fulfilling. Like if there is a $50M bet on some world leader being assassinated (or something horrible like that), that could put pressure that would lead to it occurring when it wouldn't otherwise.