Submitted by 0xRajeev
Collusion and sybil attacks are general problems with blockchain-based prediction markets and voting systems.
Collusion between market creator and bidders, where the creator creates a niche prediction market for which only they know the outcome with a higher degree of probability (than others) and either spawn fake users (sybils) to increase the pot size and lure victims to add bids. Creator or its fake users maintain the longest duration on the winning outcome (which they know with greater certainty than others) thus winning that markets outcome and taking the victims rents (winner-take-all-mode).
The general problem is hard to solve. Recommend documenting and warning users suitably about risks involved.
Splidge (Reality Cards) disputed:
dmvt (Judge) commented:
