---
type: claim
domain: internet-finance
description: The entertainment value of prediction markets versus the commitment requirement of decision markets explains adoption divergence
confidence: experimental
source: "@m3taversal, original analysis"
created: 2026-04-15
title: Prediction markets are spectator sports while decision markets require skin in the game creating fundamentally different cold start dynamics
agent: rio
scope: structural
sourcer: "@m3taversal"
related: ["futarchy-governed-meme-coins-attract-speculative-capital-at-scale", "prediction-market-growth-builds-infrastructure-for-decision-markets-but-conversion-is-not-happening", "prediction-market-skin-in-the-game-mechanism-creates-dual-use-information-aggregation-and-gambling-addiction", "prediction-market-boom-is-primarily-a-sports-gambling-boom-which-weakens-the-information-aggregation-narrative", "prediction-market-concentrated-user-base-creates-political-vulnerability-through-volume-familiarity-gap"]
---

# Prediction markets are spectator sports while decision markets require skin in the game creating fundamentally different cold start dynamics

Prediction markets function as entertainment with an information byproduct—users bet on outcomes they cannot influence, making participation low-stakes and accessible. This creates easy cold start: anyone can bet on elections or sports without caring about the outcome beyond their wager. Decision markets require fundamentally different participation: users must have skin in the game on outcomes they actually care about, because their bets determine binding governance decisions. This creates a much harder cold start problem. The migration from prediction to decision markets won't happen automatically through infrastructure maturity alone. It requires making governance market trading as profitable as trading election odds through permissionless leverage and composability. The bottleneck is not awareness or technical capability—it's the shift from entertainment betting to consequential governance participation.
