“Prices clear trades, not beliefs, so markets can stay wrong”
Explains why prediction market prices are not probabilities: the contract about an event is not the event, and rules, resolvers, collateral economics and mixed trading motives all distort the clearing price. Walks through concrete cases, including UMA's resolution of the Zelenskyy suit market and the divergent Cardi B halftime settlements on Polymarket and Kalshi. Closes on why order books clear trades rather than average beliefs, and why tail markets can stay wrong.
Some technical background helpful
Platforms mentioned: Polymarket, Kalshi, UMA