uhh... Yes of course! Prediction markets to hedge football games! #1517976, #1518216, #1520598
Some entities that may (or may not) have world-cup game risks include: "sponsors, media and broadcast partners, hospitality providers, consumer brands." I mean, I sort of think those agreements are in already, but perhaps there are clauses that says "sponsor pays double if team reaches semi-finals."
Among other "customer incentives," we have beer sales in LatAm. Naturally. #1501805
If a company says “hey we’ll give you free beer if the Knicks win,” now it has a real-world sports risk, which it can hedge by betting on the Knicks. I do not find this particularly impressive but other people do.
Another category of real-world sports risk is that some companies are sports teams, and they can hedge the fundamental risk of their business, which is losing at sports. We talked once about a Spanish soccer team that hedged its risk of getting relegated from La Liga by trading with Susquehanna.
"That is a real hedge to a real economic risk but also, you know, that’s a sports team betting on itself to lose? Seems bad? From a sports perspective?""That is a real hedge to a real economic risk but also, you know, that’s a sports team betting on itself to lose? Seems bad? From a sports perspective?"
The main example does always seem to be beer sales. Also, like, sneaker and jersey sales. And, fine, I guess. “You have never bet on a sports game,” I wrote last month, “or met anyone who has bet on a sports game, to hedge some existing economic risk.” But maybe a beer company has.
New Predyx WC contracts... somebody's business income relies on whether there are more than 11.5 goals in the quarter finals #1521428. At least the SN internal betting -- which some purple monkey newbie is _cruuuushing!_ -- is a zero-sum for plenty of fuuuun #1521224
For anyone thats spent anytime near Houston will have heard of "Mattress Mack" - he owns a very popular furniture outlet in Houston. (Its claim to fame is same day delivery and pickup of old furniture, which winds up being a killer sales point when you are shopping for a new couch and also need to figure out what to do with old one - everything is sorted today!).
Anyway, Mack has made a very innovative use of sports betting as part of his business model. Its basically a form of proxy-sports betting. It goes like this.
Suppose the Astros are in the run to get in World Series, Mack will launch a promotion that says: If the Astros get into World Series any purchase you make between date X and Y will be refunded 100% (up to $5000).
Mack then goes and places a $10M counter-bet in Vegas to hedge his risk.
So if you were thinking about buying a new living room set anyway, its best just to wait until Mack runs one of his promotions, then you have a chance of getting it 100% for free.
I'm surprised this concept hasn't caught on more in the age of prediction markets as it could really apply to lots of different businesses....
Undisc's point is exactly this: no need for prediction markets, can just use good ol fashion sports betting online
TV rights (which are themselves sort of bullshit) are a good example of risk that could be hedged with Predyxion markets. Sometimes a network will have the rights to carry a game only if a particular team is in the game, so they may want to bet against that team making it to even out their revenue stream.
Okay, okay, not the stupidest example!
The problem with scenarios like that is the prediction market isn't adding anything new. Media outlets could just as easily use a traditional sportsbook to make that hedge.
Easier, simpler, less regulated, more convenient...?
With Predyx, even cooler bc bitcoin-denominated
Yes, they're an improved model but it still isn't really a new use case. What might be new is the ability for these companies to make their own markets and structure their orders.