#3Questions: the future of Prediction Markets, with Paul Sztorc of Bitcoin Hivemind.
In the second edition of #3Questions we talk to Paul Sztorc, the inventor of Truthcoin, which eventually became Bitcoin Hivemind. In many ways, Paul is the originator, as he was the first person to put prediction markets on a blockchain, discovering an array of consequences of doing so and coming up with many new and revolutionary ideas along the way.
Here’s what he had to say.
Question 1: What do you think the future of Prediction Markets looks like?
Paul: ‘I firmly believe the prediction markets are the future. Our ancestors were bored all the time, and had nothing to read or learn; but today we are drowned in information that we cannot process. Markets aggregate information, so they do *better* the more that you throw at them. Future generations will view the institution the same way that we view things like the printing press or a trial-by-jury.’
Question 2: If or when mass-adopted, what do you think will be their main use-case?
Paul: ‘They will have the biggest impact where information is stigmatized, somehow. So, if you are a Theranos employee who knows the technology is doomed, or just any employee who knows their work-project is doomed, prediction markets will give you a way to get that information out into the world.
Another example of stigmatized information is the minimum wage — economists agree that it is one of the least-helpful policies for the poor, but educated people are afraid to oppose it openly, for fear of it appearing that they don’t care about poor people. Markets can just define success criteria, and examine policies that might meet these criteria. Much more rational world.
Another example: if you think you can do a better job than the current CEO. That type of thing.’
Question 3: What are the current challenges that need to be solved?
Paul: ‘Ideally, the public would understand the institution better so that it could go mainstream. But that appears very unlikely to happen for a while. So first it would be nice if there were more blockchain prediction markets, and if people talked about these in the news. And if these received more attention from developers, academics, investors, and activists.’
We would like Paul for taking his time and answering our questions, some extremely valuable pointers there!
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