Currently, the prediction market sector is witnessing a unique wave of entrepreneurial enthusiasm, presenting an extremely rare phenomenon—capital is chasing products like a tidal wave. Venture capital firms (VCs) are actively seeking innovative prediction market projects or related infrastructure, which has become a distinctive feature of this emerging asset class in its early development stage.
From the movements of investment institutions, their demands are clear and varied. Paradigm has a keen eye and is dedicated to finding teams capable of creating 'moonshot' level products for the prediction market. So-called 'moonshot' products mean disruptive outcomes that can bring about significant change, creating remarkable opportunities like GMGN in the meme era, or focusing on the development of specific functional tools represented by fine directions such as Axiom or Bonkbot.
Boost VC focuses on fund products related to Poly market and has even shown strong interest in launching a similar market. This indicates optimism about the fund model in this field and the potential for the market to operate independently.
YZI Lab had already focused on the differentiated growth strategy of the BNB chain trading market at an earlier stage. It keenly realized that achieving differentiated development through unique growth strategies is key to standing out in a fiercely competitive market.
The entrepreneurial path in prediction markets can be roughly divided into two clear tracks, each with unique challenges and opportunities.
Entrepreneurs building trading markets directly are like navigating in a competitive red ocean, where the key to success lies in finding significant differentiation advantages. This differentiation can be explored on three levels.
At the infrastructure level, innovation is the core driving force. Entrepreneurs are attempting to use various novel curves to achieve permissionless market listings, breaking the cumbersome restrictions of traditional listings, lowering market entry barriers, and allowing more creativity and projects to quickly enter the market. At the same time, using AI-driven oracles for settlement can improve the accuracy and efficiency of settlements, providing solid technical support for market operations.
Formulating precise entry strategies for specific regional markets is equally crucial. Users in different regions have unique cultural backgrounds, consumption habits, and areas of focus. For example, users in Europe and America may pay more attention to predictions in technology and finance, while Russian users may be more interested in energy and politics. Understanding and meeting these specific needs can help trading markets establish a foothold in regional markets.
Innovations in gameplay at the product level are key to attracting users. By implementing novel operation methods such as vertical swiping to select markets and quick betting left and right, the user experience and enjoyment can be enhanced. Integrating hardware wallets can enhance the security of user assets, allowing users to participate in market transactions with greater peace of mind. Introducing gamification mechanisms can increase the entertainment value of the product, attract more users, and enhance user retention and activity.
Compared to directly building trading markets, the entrepreneurial path of providing infrastructure tools for the market currently appears to have a clearer and more certain commercial outlook. These 'shovel sellers' provide various tools and services, offering strong support for the development of prediction markets.
Developing trading robots that follow large traders is one important direction. Promoting and growing through social channels like Telegram, these trading robots can attract a large number of users to follow the actions of big traders, gradually evolving into data tools that provide decision-making references for users.
Building automated programs for arbitrage across different markets is a clever move to profit from market price differences. These programs can quickly capture market opportunities, optimize capital allocation, and bring stable returns to investors.
Turning the high-quality information generated by prediction markets into products and selling them to traditional financial markets is an innovative business model. Prediction markets gather the wisdom and judgments of a large number of users, and the information generated has high value. Selling these information products to traditional financial markets can provide valuable references for traditional markets and create positive externalities for prediction markets, promoting the synergistic development of both markets.
Developing professional data analysis and monitoring tools for vertical fields such as football can meet the specific needs of users for professional information. These tools can help users better analyze match data and predict match outcomes, improving their decision-making accuracy in prediction markets.
In the entrepreneurial wave of prediction markets, specific innovative ideas shine like brilliant stars, deserving of in-depth consideration and exploration.
Introducing the Lego combination concept of DeFi into prediction markets is a highly forward-looking attempt. Allowing users to collateralize their positions to borrow USDC to continue pushing up market probabilities is essentially a way to amplify capital efficiency using financial leverage. This not only enables users to participate in larger market trades with less capital but may also influence market sentiment, bringing new vitality and variables to the market.
Exploring predictions under privacy protection is also an important direction. Achieving anonymous ordering can protect the privacy of participants who may have insider information, allowing them to participate in market transactions more freely. At the same time, this can attract more users to the market, enhancing market liquidity and activity.
Innovation in incentive mechanisms is equally important. Providing transaction fee sharing to users creating markets can effectively stimulate the emergence of quality markets. Users will actively create valuable markets to obtain more shared revenue, thereby enriching the diversity of the market and improving its overall quality.
Deeply integrating prediction markets with social gameplay or providing SDK integration for other platforms is an effective way to expand the user base and traffic. Through social gameplay, users can share their predictions and trading experiences with friends, increasing interactivity and enjoyment. Providing SDK integration for other platforms can enable more platforms to quickly access prediction market features, expanding the market's coverage.
The combination of prediction markets and governance is a highly imaginative and potentially developmental direction. Using real-money prediction markets to elect leaders for DAOs or make decisions can introduce stronger economic constraints and collective intelligence into decentralized governance. In prediction markets, participants need to express their judgments and intentions with funds, making decision-making more scientific and rational. At the same time, economic constraints can encourage participants to engage more responsibly in decision-making, improving the quality and efficiency of the decisions.
In this entrepreneurial feast of prediction markets, the enthusiasm of capital provides strong motivation for entrepreneurs, while innovative thinking and diverse paths inject infinite vitality into the industry's development. In the future, prediction markets are expected to usher in a more glorious development chapter driven by both capital and innovation.
