Prediction markets aggregate human judgment in theory, but some of their consistent trading opportunities may end up captured by systems that move faster than any person can.
Arbitrage opportunities can show up as brief mispricings, from outcomes that temporarily fail to sum up to 100%, to short delays in how quickly markets react to new information.
Rodrigo Coelho, CEO of Edge & Node, said bots a...
The narrative presents a compelling case for the growing influence of AI in prediction markets, highlighting both the efficiency gains and the risks of manipulation. The strongest version of this argument acknowledges that automation democratizes access to arbitrage opportunities while also intensifying competition and potential systemic vulnerabilities. The article effectively illustrates how AI-driven systems exploit inefficiencies, such as latency arbitrage, where bots capitalize on delays in...