One of the problems is that by creating a prediction market for your death, you may be creating a hit for yourself.

You enable different enemies to crowdsource for your bounty, and as soon as it is deemed worthy by a hitman, they might take up on the job by placing the opposite bet.

It's a very specific example but the mechanics work for most events in a similar fashion.

It is for this reason that event creation is not open to the public, but rather handled by the regulated markets themselves