“collateralizing prediction market positions unlocks liquidity and corrects longshot mispricing”
Proposes a DeFi primitive for borrowing against prediction market positions, arguing that collateralization solves the capital lock-up problem in long-dated markets. Walks through how position lending could improve liquidity, correct persistent mispricings like longshot mispricing, and open composability with the broader financial ecosystem, while flagging the liquidation risks unique to binary outcomes.
Some technical background helpful
Platforms mentioned: Polymarket