Prediction Markets and Futarchy with Zeitgeist
This week, Jorrin Bruns (Support Engineer, Parity Technologies) is joined by Zeitgeist’s founder Logan Saether, and CIO, David Perry. Zeitgeist is a Substrate-based decentralized network for creating, participating in, and resolving prediction markets, and exploring the potential of futarchy for governance. They discuss prediction market systems, futarchy for decision making, mitigating market biases, how a prediction market works, and its diverse applications — from improving on-chain governance to choosing political candidates and predicting parachain slot auction winners. The team also describes the next steps for this project in terms of usability and adoption, such as parachains leveraging futarcy, developing an SDK to speed up prediction market app deployment, and their plans for Zeitgeist to become a Kusama parachain. Links Zeitgeist’s website The Wisdom of Crowds, James Surowiecki Keynesian beauty contest Futarchy Kusama Derby Conclusion Results Highlights 01:05 What is Zeitgeist 08:10 Prediction market systems 10:27 Futarchy for decision making 13:20 Zeitgeist Substrate pallet recipe 18:00 Automated Market Makers 20:15 How a prediction market works 26:14 Prediction market efficiency given subjective information 27.58 Mitigating prediction market biases and incentives 30:02 Prediction markets within politics 34:15 Types of prediction markets 38:20 Building an SDK 41:20 Zeitgeist plans as a parachainSpecial Guests: David Perry and Logan Saether.