Leverage scales market-price manipulation linearly while shifting outcome-manipulation thresholds and multiplying informed-trading rents in three distinct ways, calling for re-allocated regulatory attack surfaces rather than net reduction.
The Signal Credibility Index for Prediction Markets: A Microstructure-Grounded Diagnostic with Weighted and Time-Varying Extensions
4 Pith papers cite this work. Polarity classification is still indexing.
4
Pith papers citing it
abstract
Prediction-market price moves are widely treated as informationally equivalent: a price jump is read the same way regardless of whether it reflects durable Bayesian updating, transient liquidity pressure, strategic position adjustment, or genuine disagreement. This paper formalizes the Signal Credibility Index (SCI) introduced in Nechepurenko (2026) as a stand-alone diagnostic. We make four contributions: (i) a revised persistence component using the persistence ratio PR(t,w) on logit prices, well-defined on short rolling windows; (ii) a weighted Cobb-Douglas form SCI({\alpha}\alpha {\alpha}) with flow-based concentration HHI_flow; (iii) a time-varying specification SCI(t; w) for real-time monitoring; and (iv) Monte Carlo validation including an out-of-distribution stress test, coordinated multi-wallet manipulation, and a logistic-regression benchmark. The validation establishes discrimination among designed microstructure regimes, not external evidence of downstream coordination effects. We document two failure modes consistent with the index targeting coordination credibility rather than pure information content: a Type II error on informed-but-concentrated whale repricing, and a Type I error on coordinated multi-wallet manipulation.
fields
q-fin.TR 4years
2026 4representative citing papers
The paper organizes seven canonical variants of event-linked perpetual futures along four design axes, supplying payoff definitions, inheritance rules from prior work, and variant-specific constraints.
PIRAP passes some pre-registered risk floors on Polymarket data but fails others on welfare and bad-debt metrics, leading to an explicit non-deployable recommendation while documenting a halt-versus-margin distinction.
Polymarket fill-side trading appears uni-modal due to missing quote-lifecycle data, with whale, high-frequency, and power-trader tiers dominating 81.4% of notional across 12.6% of addresses.
citing papers explorer
-
Manipulation, Insider Information, and Regulation in Leveraged Event-Linked Markets
Leverage scales market-price manipulation linearly while shifting outcome-manipulation thresholds and multiplying informed-trading rents in three distinct ways, calling for re-allocated regulatory attack surfaces rather than net reduction.
-
A Taxonomy of Event-Linked Perpetual Futures: Variant Designs Beyond the Single-Market Binary Case
The paper organizes seven canonical variants of event-linked perpetual futures along four design axes, supplying payoff definitions, inheritance rules from prior work, and variant-specific constraints.
-
Resolution-Aware Perpetual Futures on Binary Prediction Markets: An Empirical Risk-Design Framework Using Polymarket Data
PIRAP passes some pre-registered risk floors on Polymarket data but fails others on welfare and bad-debt metrics, leading to an explicit non-deployable recommendation while documenting a halt-versus-margin distinction.
-
Fill-Side Non-Retail Trading on Polymarket: An Empirical Study of Behavioral Tiers and Microstructure Signatures Under Quote-Attribution Constraints
Polymarket fill-side trading appears uni-modal due to missing quote-lifecycle data, with whale, high-frequency, and power-trader tiers dominating 81.4% of notional across 12.6% of addresses.