arXiv:2607.06166v1 Announce Type: new Abstract: Prediction markets aggregate dispersed beliefs into prices that act as probabilistic forecasts of uncertain events. Classical theory establishes a clean equivalence between forecasting accuracy and trading profit, but only for the specific automated market maker (AMM) design. However, the largest exchanges today are based on central limit order books in which informed forecasters routinely lose money while uninformed strategies can profit on simple heuristics. We resolve this discrepancy by establishing a formal equivalence between predictive acc
Source: arXiv cs.AI — read the full report at the original publisher.