What I said to BusinessWeek

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BusinessWeek&#8217-s Ricky McRoskey:

Experts expect the initial reaction to CFTC regulation to be more low-cap, nonprofit markets like the one created by the University of Iowa. Some doubt the forecasting power in these small-scale markets, since there wouldn&#8217-t be enough monetary incentive for traders to seek and discover information. &#8220-We do not need nonprofit prediction exchanges,&#8221- says Chris Masse, editor and publisher of the prediction market blog midasoracle.org. He says that [offshore] exchanges like Intrade and Betfair, which are for-profit, have the capital to continually offer more cutting-edge pricing systems and additional contracts while nonprofits like the IEM have not.

I meant that real-money prediction exchanges that make profits do support innovation (see BetFair&#8217-s new bet matching system and starting-price system) and are well positioned to foster socially valuable prediction markets (see the huge effort that InTrade is making in this direction).

Voila. :-D

Psstt&#8230- You&#8217-ll notice that I am the only one in that story to mention and speak favorably of InTrade-TradeSports and BetFair-TradeFair. :-D

2 thoughts on “What I said to BusinessWeek

  1. Medemi said:

    see BetFair’s new bet matching system and starting-price system

    Those are great innovations. We are all thrilled about that.

  2. medemi said:

    The reality of the matter is, when you’re dealing with a monopolist you don’t have to expect any significant improvements which benefit the public. In stead, you might find yourself spending a lot of energy and time to make sure the clock doesn’t go backwards. I could name you half a dozen, probably even a dozen significant improvements, of which I have seen none to date. What’s even more worrying, is that the competitors haven’t picked up on them. They prefer to behave like copycats, thinking that whatever the market leader does is holy. I find that very worrying, and it shows us what a lack of innovation, even ignorance, we’re dealing with.

    The conclusion must be that the customer isn’t central, not in the world of betting exchanges. Draw your own conclusions. 

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