Prediction markets, DATs, and the fee switch in crypto

Jeff Yass, a trader and mathematician, argues that prediction markets could revolutionize decision-making in society by providing better forecasts on various issues, including wars and political outcomes. He believes that knowing potential costs could prevent conflicts like the Iraq War from occurring. A recent study has found that prices in political prediction markets demonstrate momentum, akin to stock markets, which may provide incentives for experts to participate and improve the quality of information available. Additionally, the boutique investment bank Cohen & Co. recently generated $179 million in revenue from a single digital asset transaction (DAT), despite a significant drop in share value after the merger announcement. Uniswap Labs has proposed to collect fees and distribute them to token holders, signaling a shift toward a corporate-like structure for the protocol. However, this raises questions about regulatory implications, particularly concerning whether the UNI token could be classified as a security under U.S. law. The SEC's stance emphasizes accountability and the need for clear distinctions between tokens and traditional corporate equities.

Source 🔗