How to capture the next Alpha in the narrative of predictive markets?

Core Viewpoint

The Four Hundred Years of Pricing Failure

Four hundred years.

From the issuance of the first stock by the Dutch East India Company in 1602 to today, we have spent a full four hundred years answering one question:

How much is something really worth?

Over these four hundred years, smart people have created one valuation model after another. DCF, PE, SOTP, Comps------each trying to capture the truth of value through formulas.

But what is the truth?

The truth is that these models have never truly explained value. They merely provide a reason for a small group of people to charge another group.

Have you ever thought about it carefully------the complex valuation frameworks taught in business schools actually serve only two real purposes in the real world:

First, to raise the industry threshold. Making enough people feel that "finance is so difficult," so that a small number of people can make big money.

Second, to give you a piece of paper, a number, a starting point for negotiation. You walk into a conference room and slam your calculated DCF model on the table------it is not the truth; it is a bargaining tool.

That's all.

When a prestigious graduate spends 72 hours building a three-page DCF model and then walks in with a seven-figure annual salary to "price" a company, what is he essentially doing?

He is arbitraging using his degree and information asymmetry. Just like what Wall Street has been doing for four hundred years.

When bubbles come, these models never give a warning. After the bubble bursts, these models can always rationalize themselves.

After each crisis, financial workers do not reflect on the failure of the models themselves------but find new variables, new assumptions, new excuses, packaging mistakes as "black swans," and continue to siphon money from this huge financial machine.

Valuation models do not predict the future. They only explain after the fact. And every "after-the-fact explanation" is a ticket for Wall Street to continue charging fees.

But there is something happening here that most people have not yet realized.

The parts that those valuation models can never capture, such as events, expectations, and the collective human judgment of the future, are being priced by a brand new mechanism.

Prediction markets. Yes or No.

No three hundred-page pitch book, no jargon that requires an MBA to understand, no WACC assumptions known only to insiders.

Just one question, one price, a zero-sum game.

Prediction markets are turning the "event" itself into a tradable asset.

I call it "Event as an Asset."

This is something that cannot be modeled by DCF, cannot be measured by PE, but genuinely affects the price of every traditional asset on Earth. Wars, elections, policies, technological breakthroughs------these "events" have always been the core variables in asset pricing, but for four hundred years, no model has truly assigned them an independent price.

Until now.

The zero-sum game of prediction markets is becoming a missing piece in the traditional financial valuation system. It is not replacing Wall Street; it is completing what Wall Street has never accomplished in four hundred years.

Events Are the Atoms of Valuation

What is the essence of finance?

Pricing.

How are stocks priced? PE, profit growth rate, DCF. Translated into plain language: a stock is the present value of all the future value a company can create.

But the problem is, who can accurately predict the future?

No one has the final say.

So when unexpected events occur and people's faith in the future wavers, stock prices move accordingly.

This logic applies to any asset:

Gold to 7000? Because the market expects cash to become less valuable. Bitcoin to 1 million? Similarly. The subprime mortgage boom of 2008? Because everyone believed borrowers would not default.

This is not financial nihilism. This is the fundamental operating logic of finance.

What finance binds is the value that assets can create. But the value that assets can create is strongly bound to the uncertainty of the future------that is, "events."

Therefore, events themselves can not only be priced but must be priced.

To put it simply:

The essence of finance is pricing. The essence of pricing is expectations. The essence of expectations is events.

From the perspective of financial history, this thread becomes clearer.

Let’s break it down through financial history again.

Initially, we only looked at tangible assets: land, machinery.

Later, we began to look at inventory and processes.

With the advent of the internet era, we started to look at expected earnings, brands, intangible assets, goodwill.

To package all the variables affecting valuation at once, we invented the simplest method: using the present value of expected earnings to determine asset prices.

To summarize these increasingly abstract factors, finance chose a straightforward and crude approach------using the total of future earnings expectations to determine today's value.

Thus, the entire financial world became a game about "expectations." K lines fluctuate, and essentially, what fluctuates is expectations.

For example.

When Wall Street investment bankers go all in on Nvidia, they will give you a bunch of "rational" reasons:

Under the AI wave, how high Nvidia can achieve in CAGR.
In the future AI world, how large a market cap Nvidia can occupy.
Using revenue multiples and asset ratios to calculate a "reasonable" valuation.

Then they pile up a bunch of hypothetical numbers and use DCF to tell you:

"The current stock price is still far below the target price calculated by our model."

Then, they build a model with a bunch of hypothetical numbers, run a DCF valuation, and finally tell you------the current price is far below their calculated "reasonable value."

But have you ever thought about what these assumptions really are?

They are merely a collection of events.

Will Nvidia's next-generation chip far exceed its peers------event.

Will OpenAI continue to use Nvidia's chips------event.

Will TSMC's production capacity remain stable------event.

All assumptions, when broken down, are events.

But the most fundamental variable, "events," has never been priced separately in the traditional financial framework.

A single typhoon can render a factory inoperable.

An injury to a player can cause a club's market value to plummet.

A government shutdown can force a rapidly growing company to lay off a large number of employees.

These events are continuously and dramatically rewriting the value of assets every day. But in Wall Street's valuation models, they are merely a vague footnote under "risk factors."

I studied the top business courses at the Chinese University of Hong Kong and later took finance courses at Wharton. But to be honest, I have always felt a deep-rooted hypocrisy in traditional finance.

Professors tell you that valuation rationalization is enough.

Seniors tell you that as long as the logic on the PPT holds, it's fine.

Investment banking reports jump around, and annual reports are churned out by interns earning 50 HKD an hour; the market is far from being as "efficient" as they claim.

These elites ignore the core variable of "events," yet comfortably earn million-dollar salaries based on "reasonable" valuations built on assumptions.

Event assets are the missing piece of contemporary finance.

Looking back at history, every significant leap in financial valuation has occurred when we learned to price new dimensions.

The first valuation revolution occurred at the turn of the millennium------when the market finally learned to incorporate profit growth rates into valuations, the network effects of internet products were rationalized for the first time. A whole generation of tech giants was born as a result.

When we learn to price "events" themselves, the second valuation revolution will begin.

And this is precisely what prediction markets are doing today.

The Zero-Sum Game Dressed in a Suit

"The essence of finance is the monetization of cognition."

This sentence comes from my childhood friend. He just received a return offer from JP Morgan IBD, and he regards this sentence as a guiding principle.

In his worldview, buying stocks means buying "future income streams." When prices reach expectations, he elegantly hands over the chips to the next retail investor------he calls this "the reward for value discovery."

We maintain a tacit understanding that is both adversarial and friendly. But to be honest, I have always had a cold, unresolved skepticism about the business school logic he takes pride in.

Because when you break down this narrative to its core, you will find------

The decency of traditional finance is merely packaging the plundering of liquidity and asset redistribution as "rewards for correct valuation."

This layer of window dressing must be pierced today.

The underlying belief of Wall Street elites, when examined, is built on three extremely fragile assumptions.

First Layer: The Illusion of Valuation.

They believe that assets are the sum of future earnings. Buying low and selling high is because "I saw the truth earlier than the market." But the previous section has made it clear------the so-called "truth" is merely a set of guesses about future events. No one has truly seen the truth; everyone is just betting on things that have not yet happened.

Second Layer: The Rationalization of Trading.

Selling at a high position is called "fair trading" on Wall Street. The logic is this------as long as I believe the current valuation is reasonable, selling to the next buyer is correct. As for whether the buyer loses money due to cognitive bias? That is his problem, not my responsibility.

This narrative is exquisite and self-consistent, but it lacks one thing: honesty.

The third layer, and the largest layer of shame------the lie of positive-sum games.

This is the core belief of traditional finance: companies are growing, the pie is getting bigger, so we are all winning.

But what is the reality?

The cash flow in the market is governed by macro liquidity, not by the growth of a single company. When you buy low and sell high, you are genuinely redistributing someone else's assets into your own pocket. Even if a company does create more profits in a certain quarter, under the DCF algorithm, the vast majority of stock prices are still supported by "expectations" rather than "reality."

Every penny you earn is essentially money that others misjudged about the future.

This is not pessimism. This is the underlying code of zero-sum games.

At this point, many people might want to argue: "Aren't prediction markets just gambling? Isn't that even more zero-sum?"

That's right. Prediction markets are zero-sum games. But that is precisely where their superiority lies.

What traditional finance does is package zero-sum games as positive-sum games, allowing participants to harvest each other under the illusion of "value investing," while thinking they are creating value.

What prediction markets do is lay bare the essence of zero-sum games and then operate them with a purer, more efficient mechanism.

When you strip away the hypocritical "value investing" facade of traditional finance, you will find that the underlying logic of prediction markets and asset pricing is not only of the same origin but even cleaner.

Why?

Because prediction markets perfectly replicate and optimize three things that the stock market is genuinely doing------

Cognition is Alpha. When you discover a discrepancy between real probabilities and market odds, you have found mispricing. This is logically no different from discovering an undervalued stock. The only difference is that prediction markets do not require you to pretend you are "investing in the future."

Trading is Hedging. When you buy a position in an event in a prediction market, you can do so for speculation or to hedge real-world risks------for example, going long on oil volatility to protect your energy stock position. The logic of taking over is completely consistent with the stock market.

And the most critical point is immediate value anchoring.

For example. When an AI company releases a revolutionary model, the valuations of competitors in the same field drop in response. In traditional finance, this value transfer would have to wait until the next earnings season or even the next annual report to be fully reflected. Analysts would have to re-model, investment banks would have to update research reports, and the market would have to slowly digest.

But in prediction markets?

It directly trades the event of "AI breakthrough" itself. Value transfer occurs in real-time.

No lag, no intermediaries, no one telling you with a PPT that "our model shows……".

Prediction markets are a zero-sum game stripped of hypocritical packaging, completely aligned with asset pricing logic.

At this point, the logical chain is complete.

Traditional finance anchors valuation to "future cash flows." But what constitutes future cash flows?

It is a series of specific, definable, and verifiable events.

Can a SaaS product renew its major client for the next year------event.

Will a brand face a trust crisis------event.

Will a regulatory policy be implemented------event.

In traditional finance, these events are reflected in stock prices in a delayed and distorted manner through extremely complex transmission mechanisms. Analysts guess with models, traders bet with intuition, and retail investors chase with emotions. Each layer adds noise, each layer distorts.

But prediction markets have done something that no one has ever done------they price the events themselves directly.

Without models. Without narratives. Without any intermediaries.

When events are viewed as tradable assets, the traditional financial chain of "valuation→assumptions→events" is completely compressed. We no longer need to go around in circles guessing how events will affect cash flows, how cash flows will affect valuations, and how valuations will affect prices. We trade the events themselves directly.

This is why I say------

Events as Assets are the Missing Piece of Contemporary Finance.

The essence of zero-sum games does not shake this judgment at all. On the contrary------it is precisely because we acknowledge the reality of zero-sum games that we can shed those hypocritical packages and touch the true core of pricing.

In an ideal future, companies can accurately hedge the impact of specific events on valuations through prediction markets. Investors can trade the "event" itself directly, rather than betting indirectly through a stock. Individuals can establish positions for events they care about on-chain, participating in a transparent, permissionless pricing process.

This is not gambling. This is the deepest correction to traditional financial models.

Prediction markets are the financial world that has no lies and faces the future directly.

8 Billion Dollars, Died from Granularity

Let’s shift the perspective back to my childhood friend.

During a debate about the zero-sum nature of traditional finance, he interrupted me and said something I still remember------

"This thing you’re talking about is essentially demonizing traditional finance."

I paused for a few seconds.

Not because I was convinced, but because I realized that if even he, one of the smartest peers I know, understands it this way, then most readers of this article might have the same misunderstanding.

So before continuing, I must clarify my position.

I have never intended to "negate" zero-sum games. What I want to negate is the hypocrisy of participating in zero-sum games while pretending not to be part of them.

These are two completely different things.

The biggest fallacy of traditional finance practitioners is not that they "created zero-sum games"------zero-sum games do not need anyone to create them; they are the underlying structure of the market. Their real fallacy lies in: being in a zero-sum game while remaining unaware of it. They wrap themselves in narratives like "value investing," "long-termism," and "positive-sum games," allowing themselves to psychologically become "creators" rather than "harvesters."

That is the crux of the problem.

Similarly, I have no intention of denying all past valuation models. On the contrary------most valuation models are effective. DCF, comparable company analysis, precedent transactions, they all provide meaningful reference coordinates in specific scenarios.

But effectiveness does not equal completeness.

The flaw of these models is not "wrong," but "coarse." They have a structural granularity deficiency at the system level.

This is precisely what "event assets" aim to fill.

Now let me bring this issue down to earth.

What is the greatest value of zero-sum games?

It is not to make some people rich. It is not to make the market look efficient.

The greatest value of zero-sum games is to provide endless fuel for innovation and trial-and-error that drives human development through countless repricings.

Every price fluctuation, every long-short battle, is essentially the market answering the same question------how much is this thing worth? And it is this continuous process of being answered and corrected that allows capital to flow continuously to new ideas, new companies, and new technologies.

If zero-sum games are the engine, then "pricing" is the fuel.

And event assets provide this engine with an unprecedentedly pure fuel.

Why? Because in an era where all assets are driven by expectations, event assets give every market participant a truly refined opportunity to engage in financial engineering------no longer guessing through three layers of intermediary variables but directly touching the root cause that drives prices.

Saying "refined financial engineering" might be too abstract. Let me tell a real story.

Qingshan Holding. One of the largest stainless steel companies in China.

To prevent falling nickel prices from eroding profits, Qingshan established a large number of short positions on the London Metal Exchange (LME) for hedging. A textbook-level hedging operation, logically flawless.

But the problem arose from an extremely subtle mismatch------

Qingshan produces nickel iron and high-grade nickel, while LME nickel futures contracts require delivery of nickel with a purity of no less than 99.8%.

When the Russia-Ukraine conflict broke out in 2022, the price of high-grade nickel skyrocketed in extreme conditions, and the high-grade nickel in Qingshan's hands could not be delivered on the LME to offset the short position.

The hedging tool failed. An operation intended to reduce risk instead created catastrophic risk.

Final loss: over 8 billion dollars.

Now, let’s do a thought experiment.

Assume at that time, Qingshan's risk control team could access a liquidity-rich prediction market. They wouldn’t need to guess "will nickel prices fall"------that question is too coarse, too coarse to capture the real source of risk.

They could directly trade the event of "will the Russia-Ukraine conflict escalate into a full-scale war in the next three months."

If this event position existed, Qingshan's hedging strategy would not be pierced by the granularity issue of "delivery mismatch" of financial tools. Because they would no longer be hedging against the vague proxy variable of "nickel prices," but against the underlying event that truly affects their position.

The problems that traditional financial tools failed to solve------are not due to flawed logic, but due to insufficient granularity.

This is the meaning of refinement.

The price of an asset may be influenced by hundreds of different events. Tariff policies, supply chain disruptions, technological breakthroughs, regulatory changes, geopolitical conflicts…… In the framework of traditional finance, you can only hedge these risks through some "approximate proxy tools"------and the mismatch between these proxy tools and real risks is the breeding ground for countless "Qingshan events."

When we can directly allocate assets through event expectations, the systemic mismatches caused by traditional financial tools being "too broad" will have a real solution.

This is not my wishful thinking. History has given us a perfect analogy.

In 1973, on the first day the Chicago Board Options Exchange (CBOE) launched standardized options, the total trading volume was less than 1,000 contracts for the entire day.

Looking back today, that was one of the most inconspicuous days in financial history, yet also one of the most important.

In the nearly sixty years since, derivatives based on options have proliferated------exotic options, structured products, volatility surface trading…… These tools emerged from nothing and ultimately met the hedging needs of corporate risks worth trillions of dollars.

The position of prediction markets today is strikingly similar to that of options in 1973.

Early liquidity insufficient? Yes. Market understanding not yet mature? Yes. Most people still regard it as gambling? Also true.

But if you understand the logic of "events as assets," you will realize------this is not "another gambling tool," but the next paradigm of financial infrastructure. And for today's prediction markets, from now until that paradigm is fully accepted means over a hundred times of growth potential.

There is an even deeper logic------AI.

In the AI era, our demand for refined financial tools is not linearly increasing but exponentially.

Why? Because the boundary of AI's capabilities lies in the number of factors it can process simultaneously. A traditional hedge fund analyst can track 20-30 variables and already be at the top level. But an AI agent? It can parse the probability distributions of hundreds of event factors simultaneously and adjust positions in real-time to maximize the Sharpe Ratio.

But what is the premise?

The premise is that these event factors must be "tradable."

If the market only has traditional tools like stocks, bonds, and futures, no matter how strong the AI is, it can only build portfolios with "coarse granularity" Legos. It is limited by the precision of the tools themselves.

And prediction markets provide the atomic-level financial Legos that AI needs------each event is an independent, tradable, combinable pricing unit. When these units are rich enough, AI can construct and adjust asset portfolios with unprecedented precision.

A more internet-native, combinable refined financial infrastructure is not "the icing on the cake"------it is a necessary prerequisite for the AI financial revolution.

If Bitcoin achieved "a digital currency that can be infinitely divisible," then prediction markets achieve "infinitely divisible asset allocation."

One redefines currency itself. The other redefines how we allocate risk and expectations.

The Optimal Solution Does Not Die

I know what you are thinking.

"$POLY's token issuance is the peak."

"Another PVP scheme."

"No wealth effect, no one plays."

I have heard it all. More than once.

These words are not someone's bias------this is the muscle memory trained by the entire crypto circle after experiencing countless narrative rotations. Art x Web3 is dead. GameFi is dead. Move-to-Earn is dead. So prediction markets will die too.

The logical chain is comfortingly clear: speculation → airdrop → cash out → chaos.

I understand this intuition.

But it is precisely this intuition that will make you miss the biggest financial transformation of 2026.

Because you are using the framework of "Ponzi" to understand an "optimal solution."

Let me explain what "optimal solution" means.

Let’s do the simplest thought experiment------

If the macro economy collapses tomorrow and Nvidia's stock price halves, would you conclude that "GPUs are dead"?

Would you stop using GPUs to train AI models?

Absolutely not.

Why? Because GPUs are the optimal solution for computing power. Their value does not come from stock prices but from an objectively existing, non-negotiable necessity------computing power. Stock prices can halve, but the demand for computing power will not decrease by a single FLOP.

When something becomes the "optimal solution," the fluctuations in valuation are no longer its death sentence.

This is the only standard for distinguishing "narrative" from "infrastructure."

Using the same logic, why have meme coins not died in this cycle despite reduced liquidity?

Not because memes have "value." But because memes are the optimal solution for "mutual aid schemes" in the crypto circle. You cannot find a cheaper way to issue tokens, nor a purer logic for monetizing attention. As long as speculative demand exists, memes have a market.

Why will GameFi die? Because GameFi is not the "optimal solution" for anything. It is valuation-driven------when tokens become worthless, no one wants to play a game that is already uninteresting. Its lifecycle is tied to the K line; when the K line goes to zero, it goes to zero.

Prediction markets are different. They are the optimal solution for pricing "events."

As long as humanity still needs to make predictions about the future, and humans are making predictions about the future every second, prediction markets have irreplaceable value.

The price of $POLY may continue to fluctuate.

But Polymarket will not die. Just like the price fluctuations of Coinbase's $COIN have never hindered the exponential growth of USDC. The valuation of the carrier may fluctuate, but the underlying demand will not disappear.

If you think I am daydreaming, look at Kalshi.

No tokens. No DeFi Legos. Even facing the heavy pressure of CFTC regulation.

But it is still experiencing explosive growth.

What does this indicate?

It indicates that "pricing events" itself is a huge, real demand. It does not rely on the Web3 bubble, does not rely on airdrop expectations, does not rely on any so-called "narrative."

The demand is there. No matter what technology stack you use to carry it, it is there.

Then the question becomes, if prediction markets themselves do not rely on cryptocurrencies, why do we still need to put them on-chain?

The answer is completely consistent with RWA.

Global liquidity. Borderless capital can compete in the same market.

Transparency. That is, all transactions and settlements can be traced on-chain.

Combinability. That is, as part of DeFi Legos, they can be nested with other financial protocols.

Notice anything?

The logic of explaining "why prediction markets should go on-chain" is completely isomorphic to explaining "why US Treasuries should go on-chain."

You wouldn’t say "on-chain US Treasuries are a crypto narrative," so why would you say "on-chain prediction markets are a narrative that runs away after issuing tokens"?

On-chain prediction markets are essentially on-chain stocks.

We wouldn’t say stocks are "internet products" just because they have achieved electronic trading. Electronic trading merely makes stock trading more efficient, but the value of stocks has never come from the internet; it comes from the companies themselves.

Similarly, blockchain merely makes the settlement of prediction markets more efficient, transparent, and globally accessible. But the value of prediction markets has never come from blockchain; it comes from humanity's indelible demand for pricing "events."

Reducing prediction markets to a "crypto narrative" is as absurd as reducing stocks to an "internet product."

This is a cognitive misalignment. And this misalignment is creating a huge cognitive arbitrage space.

If you focus on the airdrop expectations of $POLY, you see the first layer. Because this indeed has the potential to rival past airdrops like $HYPER and $UNI.

If you understand the essential differences between Kalshi and Polymarket, one being a compliant path and the other being a global liquidity path, you see the second layer.

And the truth lies in the third layer: events should become assets. And prediction markets are, as of today in 2026, humanity's only effective venue for pricing and trading "event assets."

Not a "crypto narrative." Not "the next GameFi." Not "another PVP scheme."

But a missing link in financial infrastructure.

This is the endgame.

Killing God’s Dice

In my sophomore year, a typhoon rewrote my life.

I was fully preparing for the MAT exam, aiming for Oxford. Everything was progressing as planned. Then Hong Kong issued the "Signal No. 8" for the typhoon, and the exam was canceled.

Just like that. No warning, no buffer. An unpredictable, unhedgeable, and even unperceivable weather event cut off my route to the UK.

But the absurdity of fate is that that typhoon kept me in Hong Kong, allowing me to meet partners from what would later become @0xUClub, ultimately leading me into Web3.

If it weren't for that typhoon, I would likely have completed my undergraduate studies at Oxford, entered an investment bank or consulting firm, and become someone who follows the rules in the traditional world. I wouldn’t be writing this article, and you wouldn’t be reading it.

A single typhoon completed a "repricing" of my personal valuation.

This is not a metaphor. This is literal.

But this story has another side.

Suppose in my sophomore year, I had already realized that my life trajectory was being reshaped by external events. Suppose I could have seen this signal earlier and gone all-in on studying trading and projects; today, I might be standing in a completely different position.

I wasted several years not because I wasn't diligent, but because I lacked the tools to perceive the events that were changing my fate.

I was pushed here by fate.

What I want to do is to enable future individuals to "walk" to where they should go.

In the previous chapters, we deconstructed financial assets------how events participate in the valuation of stocks, commodities, and derivatives.

Now, I want to turn the lens to something more fundamental: individuals.

The true ambition of prediction markets and event assets has never been just to provide a new speculative tool for financial markets.

Its ultimate ambition is to empower every individual with the power to actively navigate uncertainty.

Each of us, every day, is being pushed by "events." Policy changes, economic fluctuations, technological iterations, geopolitical conflicts, even a typhoon------these events continuously reprice our lives, and most of the time, we are completely unaware of it.

We are passive recipients of events. What event contracts aim to do is transform us from "passive recipients" into "active participants."

This is the first step in killing the dice thrown by God.

It is not about eliminating uncertainty------no one can do that.

But about making uncertainty perceivable, quantifiable, and tradable.

Imagine this world------

You are no longer passively waiting for political black swans to arrive. You open your phone and see the odds of a certain geopolitical event skyrocketing from 12% to 47% in the past 48 hours; you begin to adjust your positions, plans, and even career direction before the shockwave arrives, just like sensing the P-wave of an earthquake.

You are no longer blindly guessing how economic policies will affect your assets. The market has already voted with real money to produce a probability distribution; you only need to make decisions based on this distribution------not based on some analyst's subjective judgment, but based on the collective wisdom of the entire market.

Even down to a sports game------real-time odds changes on-chain tell you that this game will likely lose suspense by the third quarter. You decide not to waste two hours sitting in front of the screen and instead do something more valuable.

These are not science fiction. These are natural extensions of prediction markets after infrastructure matures.

But what I want to say goes far beyond this.

The future prediction market should not be something you need to "open an app" to use.

It should be like air------ubiquitous yet invisible.

It is the sorting algorithm behind news pushes------no longer arranged by click rates, but by the magnitude of changes in event probabilities, allowing you to see truly important information first.

It is the underlying decision logic of AI assistants------when your AI agent manages your portfolio, what it reads in real-time is not analyst reports but the probability changes of thousands of event contracts.

It is a support tool in live broadcasts------viewers no longer just tip, but express their positions and invest attention by predicting the outcomes of games.

It is even the underlying asset of wealth management funds------the "low-risk, stable fund" you buy has 30% of its hedging strategy composed of event contracts, and you might not even know it.

Just as today’s people can swipe short videos without understanding the TCP/IP protocol, future people will unconsciously use "event assets" to pay, hedge, make decisions, and live.

They won’t say "I am using prediction markets."

They might not even know prediction markets exist.

But behind every important decision they make, event assets are operating silently.

This is the ultimate vision of "Event as an Asset."

Not a trading exchange. Not an app. Not a "crypto narrative."

But a civilization-level infrastructure that allows humanity to actively perceive, quantify, and respond to uncertainty for the first time.

God is still throwing dice.

But starting today, we can finally see the direction in which the dice fall.

The Four Mountains on the Wasteland

The ideal has been spoken.

Now let me pull you back to reality.

February 2026. At this moment. If you open any prediction market platform, what you see is not a "financial revolution"------you see a casino dressed in Web3 clothing.

The interface is rough. Liquidity is thin. Users come in to bet on the US election, win or lose, and then leave. There is no retention, no repurchase, no reason for a normal person to treat it as "financial infrastructure."

This is the reality.

I will not pretend that reality does not exist. Because if you are unwilling to face reality, you do not deserve to talk about the future.

We are still separated from that endgame by a desolate wasteland.

And to cross this wasteland, we must climb over four mountains.

And these four mountains are the next sources of Alpha that you, as a participant in the prediction market industry, must grasp.

The First Mountain: The Island of Liquidity.

This is the most fundamental and also the most fatal problem.

Today's prediction markets have extremely fragmented liquidity. The same event------for example, "Will the Federal Reserve cut interest rates in June?"------is one market on Polymarket, another market on Kalshi, and possibly a third market on some newly emerged protocol.

They have different odds. Different settlement rules. Different criteria for resolution.

What does this mean? It means that the same "event" is actually different "assets" on different platforms. You cannot even arbitrage across platforms because you are not dealing with the same thing.

When the same event has different criteria on different platforms, "events" can never become universal "assets."

Imagine if Apple's stock had different definitions on the NYSE and NASDAQ------the NYSE's AAPL includes revenue from Apple Vision Pro, while NASDAQ's AAPL does not------can this market still operate?

This is the current state of prediction markets. How to bridge these islands and establish unified event definitions and settlement standards is the biggest proposition at present. There is no second.

The Second Mountain: The Absence of Pricing Models.

Options have Black-Scholes. Fixed income has duration and convexity. Meme coins have even developed their own framework of attention economics.

What do prediction markets have?

A Yes/No slider.

We are still using the most primitive binary game structure to trade events. No Greek letters, no volatility surfaces, no quantitative frameworks that can pass institutional risk control departments.

Our ability to price "event assets" remains in the Stone Age.

This is not a minor issue. This is a matter of life and death.

Because without a scientific pricing model, there is no institutional entry. Without institutional entry, there is no deep liquidity. Without deep liquidity, events will always be just a "gambling target," not an "asset class."

This causal chain is rigid. To break it, we must start with pricing models.

The Third Mountain: The Fault of Consensus.

What do you think the first reaction would be if you told a traditional finance practitioner that "events are assets"?

"Isn't this just betting on sports?"

If you told a crypto native the same thing, what would their first reaction be?

"Isn't this just another PVP scheme?"

Two worlds, the same misunderstanding.

This is not an intelligence issue of a certain group. It is that the entire market has not yet established a consensus on "event assets." Traditional finance categorizes it as gambling, while crypto categorizes it as narrative. Neither side sees its essence------a brand new asset class.

To achieve the endgame, we must establish a cross-industry "event asset consensus." Let traditional finance understand it is not gambling, and let crypto understand it is not just a narrative.

This is not just a Web3 issue. It is an engineering project to transfer the laws of causality from the real world to the chain. It requires regulatory understanding, academic endorsement, and enough successful cases to break through biases.

This mountain may be the highest of the four.

The Fourth Mountain: The Infantilization of Product Forms.

This is the most heartbreaking point for me.

I have observed almost all prediction market products on the market. What are most teams doing? They are creating "the next Meme Pump." A better-looking UI, a faster betting experience, more exciting real-time feedback.

They treat prediction markets like Pump.fun.

This is a directional error.

If events are assets------I have spent the entire article arguing this point------then they should possess all the infrastructure of mature asset classes.

What do stocks have? Stocks have lending, leverage, options, structured products, ETFs, indices, institutional-level trading terminals, prime brokerage, and clearinghouses.

What do event assets have? A "buy Yes / buy No" button.

This is the absurdity of reality.

We need lending agreements for events------so you can short an event without needing to hold it first.

We need leverage tools for events------so capital efficiency is no longer locked by 1:1 margins.

We need structured products based on events------so funds with different risk appetites can find suitable entry points.

We need ETF-style packaging for event assets------so ordinary users can configure a basket of event exposures with one click.

We need institutional-level trading terminals------so hedge fund risk control systems can connect.

Simply giving users a "buy up or down" button is the greatest waste of "event assets."

So let me put it more bluntly.

Today’s prediction markets do not lack trading terminals. We have countless trading terminals, each fancier than the last.

What we lack is not terminals.

What we lack is an "event bank."

An infrastructure that provides a full suite of financial services around "event assets." From pricing to trading, from lending to settlement, from risk control to asset management. Not a function, but a complete system.

Just as you wouldn’t call JPMorgan a "stock trading app"------it is a complete financial system built around stocks, bonds, and derivatives.

Event assets need their own JPMorgan.

This is the opportunity I see. It is also the city at the end of this wasteland.

Not Creating the 101st Trading Terminal

During Consensus Hong Kong, I spoke with over a hundred people about prediction markets.

Investors, builders, traders, media, researchers------all the roles you can think of, I talked to them all.

In the end, I came to one good piece of news and one bad piece of news.

The good news is: the heat is back. Everyone is talking about prediction markets. After Polymarket's breakout moment during the US election, the entire industry suddenly realizes that this track is real. Funds are pouring in, teams are forming, and the narrative is heating up.

The bad news is: imagination is dead.

In those hundred-plus conversations, the same word kept coming up------"better trading experience." Faster betting, better UI, smoother K-line panels, more socialized copy trading.

99% of people are still fixated on "building a better casino."

No one is talking about event assets. No one is talking about pricing models. No one is talking about financial infrastructure. No one is talking about that endgame.

Everyone is using tactical diligence to cover up strategic laziness.

After returning from Hong Kong, I felt conflicted. On one hand, the market's heat validated our direction. On the other hand, the entire industry's imagination about prediction markets is stuck at a level that almost suffocates me.

If the endgame of prediction markets is merely gambling, then we might as well leave now.

But we know it is not.

So we made a decision.

A decision that may seem crazy to outsiders.

We tore up the original roadmap of @insidersdotbot.

Not a fine-tuning. Not an iteration. A complete restart.

Because after those hundred-plus conversations, we finally saw one thing------

This world does not need the 101st prediction market trading terminal.

The market does not lack social trading. It does not lack copy trading. It does not lack professional K-line panels. It does not lack better-looking UIs.

These are just tools. Tools solve the "how to buy" question.

But no one is solving the "why buy" question.

No one is answering the most fundamental question------how to make an ordinary person who has never been exposed to prediction markets understand why "events" are worth trading and how this relates to their lives.

This is not a problem that can be solved by functional iteration. This is a product form issue.

What we need is not a "better trading terminal."

What we need is an event bank, an "Everything App."

An application that gives ordinary people an advantage in uncertainty. A tool that allows everyone to become an "insider" in their own lives.

This is the meaning behind the name Insiders------not the "Insider" of insider trading, but "someone who has an information advantage in their own life."

Do you know why people on Wall Street always act before you? It is not because they are smarter, but because they have better tools to perceive the changes that are about to happen. They have Bloomberg Terminals, prime brokerage research reports, and opportunities to dine with Federal Reserve officials.

And what do you have? You have a news app's push notification telling you that something has already happened.

What Insiders aims to do is take the privilege of "knowing first" from Wall Street and hand it to every ordinary person.

And the only thing that can carry this ambition is an event bank. Because only an event bank can bear the weight of "event assets." Only when the product form evolves to this point can event assets truly embed themselves in the veins of the financial world, rather than remain forever in a niche corner of a casino.

In this vision, we have set two seemingly impossible tasks for ourselves.

First, fill the abyss of infrastructure.

The Hard Tech.

Today's prediction markets have an absurdly high threshold. You need to have a wallet, understand gas fees, comprehend on-chain interactions, and endure the fragmented liquidity between different platforms. Each of these frictions keeps 99% of potential users at bay.

What we need to do is make all of this disappear.

Seamless Trading------Connecting multi-chain wallets for a gas-free smooth experience. Users do not need to know what ETH is, what gas is, or what slippage is. They click "buy," and it happens. Just like you don’t need to understand the interbank clearing system when using WeChat Pay.
Market Efficiency------Using AI-assisted pricing and cross-platform arbitrage mechanisms to eliminate outrageous price differences, allowing the same event to have consistent pricing across the entire market. The issue of liquidity fragmentation must be solved at the product level.
Financial Depth------Natively integrating lending, leverage, and structured products so that capital efficiency is no longer locked by 1:1 margins. A market that can only be fully bet on will never attract real institutional funds.
Underlying APIs and SDKs------Providing interfaces for the entire ecosystem. We are not just building a product; we are building a platform. Allowing other developers to build their own applications on top of event assets, just like countless companies build their services on AWS.

Second, rebuild a new generation of consensus.

The Soft Power.

Prediction markets should not be a self-indulgence of Web3. If it can only circulate within the crypto native circle, it will never become the "financial infrastructure" we describe.

Fiat Entry and Exit------Allowing direct participation with fiat, completely eliminating the step of "you have to buy USDC first," which deters 90% of users.
Scenario Integration------Prediction markets must connect to news, connect to social media, connect to your daily life. It should not be an app you need to open separately; it should be a layer of information naturally embedded when you read the news. When you see news that "the Federal Reserve may cut interest rates in June," there should be a real-time probability distribution next to it, and you can participate with one click.
Full Coverage------Mobile, computer, Telegram, Discord, and even future wearable devices. Ubiquitous, seamlessly synchronized. You see an event's odds change on your phone, place an order with one click on your computer, and receive a settlement notification on your watch.

This is not a feature list. This is our systematic answer to "how event assets can enter daily life."

Finally, let me talk about the landscape of the endgame.

In the future prediction market track, only three types of players will remain.

The first type: pure trading terminals. Whether minimalist or professional, they provide answers to "where to buy." They will survive, but their ceiling is limited because their value entirely depends on the depth of underlying liquidity.

The second type: underlying arms dealers. Providing SDKs and APIs, doing infrastructure. They are the supply chain of the event asset ecosystem, important but not directly facing terminal users.

The third type: lifestyle definers. The event bank that truly establishes the essence of "events as assets." Not just allowing you to trade events, but making event trading a part of your life, as natural as breathing.

Why am I confident that this is still a blue ocean?

Because the consensus on "event assets" has not yet been established------this means that the largest cognitive arbitrage window has not yet closed. Because truly mass adoption products have not yet been born------this means that the opportunity to define the category still exists. Because the entire industry's imagination is still stuck on "a better casino"------this means that when the first "event bank" appears, it will receive disproportionate attention and resources.

Prediction markets are the last missing piece in the modern financial valuation puzzle.

Whoever fills this piece will define the financial logic of the next decade.

2026 is the year of prediction markets.

This is not a slogan. This is what is happening.

I write this article not to persuade you. Persuasion is a strategy of the weak.

I write this article to document. Documenting that before prediction markets are accepted by the whole world, there is a group of people who have already seen that endgame and decided to build it themselves.

What we aim to do is not to create another casino in the world. But to give everyone the right to foresee changes and hedge their fate.

The world is a giant prediction market.

Every day, every decision, you are placing bets. The only difference is------are you blind betting, or playing your cards face up.

Our existence is to help you play your cards face up.

Epilogue: The Spark

Every revolution, before being recognized, is just an obsession on a person's desk late at night.

Over forty years ago, Robin Hanson (@robinhanson) wrote a perplexing idea in an academic paper------if we let people bet real money on the future, would the probabilities obtained be more accurate than any expert predictions?

At that time, there was no blockchain, no DeFi, no infrastructure to support this idea. There weren't even enough people to understand what this question was asking.

But he wrote it down anyway.

In an era when the entire academic community was optimizing old models, he was the first to say, "We need a whole new dimension of pricing." He did not wait for the world to be ready. He simply buried the spark in the ground and believed that one day, someone would come to ignite it.

Even earlier------so early that this story is almost forgotten------Robert Forsythe, Forrest Nelson, and George Neumann did something that seemed to have no commercial value on the campus of the University of Iowa.

They established the Iowa Electronic Markets. An experimental market that traded election results with real money. No funding, no user growth metrics, no one thought this was a "business."

It was just an experiment by three scholars on a belief: the judgment of the crowd can be priced.

That experiment was the first seed of prediction markets in the real world. Today, every prediction market platform globally carries the genes of that afternoon on the Iowa campus.

Then came a long silence.

Nearly thirty years. Prediction markets were cited in academic papers, discussed in geek forums, and ignored in the mainstream world.

Until the times began to accelerate.

In 2020. The wilderness of crypto. The gray area of regulation. All the "serious people" were staying away.

Shayne Coplan (@shayne_coplan) founded Polymarket in this neglected wilderness.

There were no precedents to follow. No mature compliance paths. No guarantees that this would not be directly shut down by regulators one day.

But he was not betting on the success of a project------he was betting that "event pricing" itself is unstoppable.

It turned out he was right. Polymarket's performance in the 2024 US election made the whole world realize for the first time------the probabilities given by prediction markets are closer to reality than those of all polling agencies, all political analysts, and all traditional media judgments.

At that moment, prediction markets transformed from a "crypto toy" into a global information infrastructure. And the starting point of all this was a young man choosing to believe when no one else did.

Almost simultaneously, the battle on another path was equally fierce. In 2021, Tarek Mansour (@mansourtarek_) and Luana Lopes Lara (@luanalopeslara) co-founded Kalshi------not in the gray area of crypto, but in the heart of the strictest regulatory system in the United States.

They chose a path that almost no one dared to take: directly confronting the CFTC, obtaining a compliance license, and making event contracts legally recognized financial products.

This is not "Move fast and break things." This is "Move slow and build legitimacy."

Every hearing, every legal document, every tug-of-war with regulators is fighting for something for the entire prediction market industry------legitimacy. Not for the legitimacy of Kalshi as a company, but for the legitimacy of the proposition that "events can be priced and traded."

They carved a seam in the iron wall. And that seam let sunlight into the entire industry.

I have spent a long time thinking about one question------what do these people have in common?

Not resources. Not backgrounds. Not luck.

It is that they all chose to believe when no one else did.

Robin Hanson believed that collective wisdom could be priced when the academic community thought he was dreaming. The three scholars from Iowa believed that a campus experiment could change cognition when there was no commercial return. Shayne believed that event pricing was unstoppable when regulators could press the stop button at any moment. Tarek and Luana believed that the compliance path would eventually work out when everyone said, "The CFTC won't approve it."

Each of them was seen as a heretic.

What they were betting on was not the success or failure of a particular round of financing. They were betting their time, reputation, careers, and a seemingly naive belief------that the world needs a more honest way of pricing.

Today, the annual trading volume of prediction markets has surpassed 10 billion dollars. Event probabilities are beginning to influence global media narratives and institutional decisions. The concept of "event assets" is being seriously written into research reports and investment memos for the first time.

Looking back, the spark has never gone out. It has just been waiting for enough oxygen.

And these people are the ones who have kept it alive with their own breath during the suffocating years.

I write this article not to declare victory------the revolution is far from over. Ahead lies a wasteland, and the four mountains still stand tall.

I write this article to document a long relay from academic papers to campus experiments, from the crypto wilderness to regulatory iron walls, from "no one believes" to "no one can ignore."

Everything we do today------pushing "events as assets" from prediction markets to stocks, bonds, real estate, corporate valuations, and the life decisions of every ordinary person------is not starting from scratch.

We are the torchbearers.

The last missing piece of the four-hundred-year financial puzzle has finally been picked up. It was not filled by a single person, but by generations of misunderstood individuals, chiseling it out bit by bit with their best years.

To Robin Hanson, to the pioneers of Iowa, to Shayne, to Tarek and Luana, to all who have fought and are still fighting on this path------

What you have illuminated is not just a market.

What you have rewritten is the way humanity coexists with uncertainty.

God is still throwing dice.

But because of you, we have seen the direction in which the dice fall for the first time.

And the mission of our generation is to turn "seeing" into "grasping."

History will remember this page.

Not because of any one person's name, but because------in an era where everyone was accustomed to blindly betting in the dark, a group of people chose to light a lamp.

This time, we will not be bystanders.

We will be the ones throwing the dice.

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