A trading strategy profiting from discrepancies between the implied probabilities of events in a prediction market and the actual probabilities or prices in other markets. This involves buying outcome tokens at a lower price and selling them at a higher price, or vice versa, to equalize valuations. Successful execution requires rapid identification of mispricings and efficient transaction capabilities. This activity contributes to more accurate probability discovery.
Context
Prediction market arbitrage is a key aspect of decentralized prediction platforms, frequently discussed in crypto news. Reports might detail how traders exploit differences between prediction market odds and real-world data or other betting markets. This type of arbitrage helps to align the collective wisdom expressed in prediction markets with external information, thereby improving their accuracy.
An LLM-driven semantic methodology maps complex logical dependencies between prediction markets, revealing $40M in extractable value and systemic inefficiency.
We use cookies to personalize content and marketing, and to analyze our traffic. This helps us maintain the quality of our free resources. manage your preferences below.
Detailed Cookie Preferences
This helps support our free resources through personalized marketing efforts and promotions.
Analytics cookies help us understand how visitors interact with our website, improving user experience and website performance.
Personalization cookies enable us to customize the content and features of our site based on your interactions, offering a more tailored experience.
