A good example of this is using prediction markets to reduce LVR. Prediction markets have incredible capital efficiency for forecasting - even $10K of capital is often enough for high accuracy. Prediction markets should be efficient enough in aggregate that they can be used as on-chain oracles - incorporate exogenous price sources & prevent LPs... See more
adly, Manifold does not produce particularly good predictions. In last year’s ACX contest, it performed worse than simply averaging predictions from the same number of people who took part in each market. Their calibration, while good by human standards, has a clear systematic bias towards predicting things will happen when they don’t (Yes bias).... See more