My Personal Thoughts on Prediction Markets Prediction markets are likely to become a new battleground for projects and market makers (MMs) beyond mere betting platforms. They are not simply a place to predict winners or losers; they can be used to design market prices and develop strategies to generate liquidity. 1. The Question Itself is Marketing (Inception) • The act of partnering with a specific prediction market and posting project-related questions is the most powerful marketing tool. • Anchoring: The moment a question like "Will token X reach $1 by the end of the year?" is listed, the target price is naturally imprinted in investors' minds. This creates a much more powerful psychological impact than simple marketing. 2. MMs and Two-Way Hedging (Risk-Free) • "Safe Playground": MMs provide initial liquidity to the prediction market pool, while also establishing hedging positions in the spot or futures market. • Zero Risk: MMs earn fees and volatility profits regardless of win or loss. This creates an optimal environment for expanding the market with nothing to lose. 3. Retail Participation and Buying Pressure (Organic Pump) • "Natural Buying Inducement": Users who bet on a rise (Yes) buy actual spot to increase their odds of winning or due to confirmation bias. • Self-Fulfilling Prophecy: No artificial self-trading. The most natural and legitimate buying pressure occurs, inducing users to drive up prices. Comment From the project's perspective, this is the most sophisticated means of boosting liquidity, and it appears to be no different from a financially engineered "popularization of the options market."