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Showing posts from July, 2020

Belief markets: short conspiracy theories using prediction market technology

Overview This article introduces a new concept called 'belief market'. The closest relatives of belief markets are prediction markets, thus I will introduce the concept by describing how prediction and belief markets differ. Prediction markets allow participants to make bets on outcomes of events. More generally, bets can be made on answers to questions which can be unambiguously answered in future. A participant can update his position until the market is closed and a question is resolved, which makes it different from other kinds of betting. Belief markets allow participants to bet on answers to questions which cannot be reliably resolved. In other words, belief markets allow participants to bet on something they believe should be true, even if an answer cannot be determined in such a way 100% of participants would agree with. Instead of that, a virtual resolution is based on a consensus among a subset of participants. To make this possible, belief markets rely on cryptocurre