Researcher
Related Projects
At its core, finance is an exchange between ‘time’ and ‘liquidity’. TradFi has early-settlement services, factoring, and repo transactions for the same reason. You use assets as collateral to buy time, and you pay a cost for it.
The same logic holds in crypto markets, too, through mechanisms like staking or Pendle’s PT/YT structure. And interestingly, you can observe the exact same flow in prediction markets. There are plenty of markets we could look at, but let’s make it concrete with an NBA game from January 13 (San Antonio Spurs vs OKC Thunder).
source : espn.com
As a Spurs fan cheering for Victor Wembanyama, it hurts to say this, but the matchup was a textbook underdog game. Even before tip-off, ESPN’s win probability model already gave OKC a 70% edge, and the actual game script followed that direction, with OKC taking over late in the third quarter.
With 32.1 seconds left in the third, OKC’s Kenrich Williams knocked down a three to push the lead to 19. At that moment, OKC’s win probability reached 99%, and the remaining fourth quarter effectively became “garbage time,” with the outcome all but decided. The question is: how did the market react during this supposedly boring stretch?
Most people may see garbage time as meaningless, dead minutes. But someone saw a clean opportunity. In fact, 75% of the total in-game trading volume was executed right at this point, immediately after the outcome had essentially tilted beyond doubt. Summarizing the trades after that moment:
Investment horizon: About 2 hours (buy to settlement)
Total capital deployed: $102,260.03
Net profit: $118.83
ROI: 0.116%
APR (Annualized) : 389.06%
You can interpret this trading behavior rationally from three angles.
Financial perspective : This is not gambling on uncertainty. It is closer to ultra-short-term bond trading: buying a future $1 cash payout that is already 99% certain, at a very slight discount. What looks like meaningless garbage time to the crowd becomes “liquidity factoring time” for someone else.
Domain perspective : Because basketball features frequent possessions and a high-scoring structure, it tends to have a lower upset rate than many other ball sports. On top of that, the opponent was OKC, a team that was clearly outperforming in that moment.
Airdrop farming perspective : Prediction market like Polymarket(@Polymarket) has already hinted at a token launch and the possibility of an airdrop. This applies not only to Polymarket but to prediction markets as a whole, If a user needs to build trading volume for an airdrop, then this kind of trade becomes a highly rational strategy: it lets you accumulate volume while pushing risk extremely low.
Of course, you cannot fully rule out a black swan, like T-Mac’s famous 13 points in 35 seconds. But probabilistically, events that rare are better treated as ‘Act of God’, closer to a natural disaster than a normal investment failure.
This approach is not limited to NBA games. The core idea is to exploit the time gap between “the result is effectively realized” and “final settlement.” Of course, risk and return vary depending on when the investor decides the outcome is “confirmed,” meaning where they set their threshold for conviction. But if you view prediction markets not as simple betting, but as a market where probability and time are traded with precision, it becomes an area well worth watching.
