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Prediction Markets and Insider Trading: Creators Acknowledge Blockchain Transparency as the Sole Safeguard
Prediction markets are increasingly being characterized not as gambling platforms but as mechanisms for monetizing information, although founders admitted that the distinction can often become unclear.
Jared Dillinger, CEO of New Prontera Group, Farokh Sarmad, co-founder of DASTAN and Ding X, founder of Predict.fun at Consensus Hong Kong 2026. (CoinDesk)
What to know:
- Founders contend that prediction markets monetize information, though the intent of users can differ.
- Onchain transparency is beneficial, but information asymmetry continues to pose a significant issue.
- How platforms tackle manipulation and disclosure will influence institutional acceptance.
Prediction markets are increasingly being characterized not as gambling platforms but as mechanisms for monetizing information, although founders admitted that the distinction can often become unclear at Consensus Hong Kong 2026.
Ding X, the founder of Predict.fun, posited that prediction markets are more akin to insurance underwriting or poker than to roulette. “It’s more information trading and attempting to hedge risk, rather than gambling,” he stated, differentiating skill-based forecasting from games where long-term odds lead to guaranteed losses.
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Farokh Sarmad, co-founder of DASTAN, concurred that speculation exists but described the sector as “a multi-trillion dollar asset class in the making.” He sees prediction markets as simply “financializing information,” permitting participants to earn from their insights instead of allowing the value to reside solely with media firms or bookmakers.
Jared Dillinger, CEO of New Prontera Group and a former professional athlete, remarked that classification largely relies on how platforms are structured and utilized. “It just depends on the eyes of the beholder,” he expressed, adding that prediction markets serve as “an information asset class,” even if some users perceive them as bets.
The more pressing challenge is insider trading. Noteworthy incidents—from leaked entertainment setlists to geopolitical events—have highlighted the threat of information asymmetry.
“Insider information is not acceptable,” Sarmad stated, noting that blockchain transparency can reveal suspicious wallets. Nonetheless, Dillinger recognized limitations in enforcement. “There’s always going to be some loopholes that people will find.”
As trading volumes increase and regulators become attentive, founders agreed that surveillance tools, clearer disclosure standards, and enhanced platform governance will define whether prediction markets evolve into a recognized financial category or continue to be perceived as speculative betting.
