Let's talk about the recently popular prediction market Polymarket. Can users really make money based on information asymmetry?

You've all heard of P station, right? Its popularity is about to surpass 365! Essentially, this thing is similar to a lottery, betting on the timing and probability of events occurring, but it claims to be a platform based on blockchain technology, so its valuation is quite good (9 billion USD), and its claim to fame is predicting the 2024 U.S. election!

Therefore, those who have worked at the Pentagon are surely familiar with it; this can be considered an essential path for 'insider policy makers and actors' to get rich! One of the trading centers for the 'Pizza Index' we often see is right here!

Currently, the hottest probability bet on P station is whether Khamenei will step down before January 31 and whether Israel will launch a surprise attack on Iran before January 31. Today, Trump has already stated that he may take severe action against the unrest in Iran!

1. What is Polymarket?

Polymarket is a decentralized prediction market platform founded in 2020 by Shayne Coplan, deployed on the Polygon blockchain. Its core function is to allow users to make 'betting-style trades' on the outcomes of real-world events using cryptocurrencies (such as the USDC stablecoin), but it currently also supports cash and most credit cards.

2. Core Features and Business Model of P Station

P station primarily relies on blockchain technology to achieve anonymous transactions, without the need to bind a bank account with real names. Users worldwide can participate freely through cryptocurrencies, and the low transaction costs on the Polygon chain support high-frequency small transactions.

3. The Core Reasons for the Popularity of Polymarket

In my opinion, the first reason is that it has blockbuster cases, and accurate predictions have created a word-of-mouth effect. For example, in several events such as the 2020 U.S. election, the 2024 election, the change of UK Prime Minister, and the collapse of Silicon Valley Bank, Polymarket's prediction accuracy far exceeds traditional channels, allowing it to move from a niche platform in the crypto circle to mainstream visibility, becoming an 'information filter' for many investors.

4. Can users really make money based on information asymmetry?

In theory, the core of profitability in prediction markets is 'information asymmetry' (the deviation between individual cognition and market consensus), but in practice, it is extremely difficult for average users to make money based on information asymmetry, and the operability is very low.