Disclaimer: This article is for educational purposes only and does not provide financial or investment advice. The reader is aware that there are special risks involved in dealing with blockchain and cryptocurrency assets.

What good do markets do if there discriminate against the wider public? None!

There is a need for a fundamental change of market accessibility. With the introduction of blockchain technology, the technical fundament for that has been established. It is not surprising that the most successful projects in the cryptoshpere are finance based. The financial use-cases are just the most obvious and “easy” to establish. CloseCross does precisely that: making accessible a market (the largest there is) to the general public. That alone is more than impressive, but the way they do it is even more so.

I have a background in gambling and still use concepts from the domain a lot. The years I studied different forms of gambling (mainly sports betting and poker) formed my mind a lot. Now I am not saying derivatives are „gambling“ at least not in a negative way. However, the parallels are apparent. You find a prediction market that suits your knowledge, discover a market that you think you have a competitive edge, assess the risk, and if you like the upside, you stake it.

Now with derivatives, it is pretty much the same. The underlying outcomes are mostly based on the financial markets. The regular underlying assets are FX, commodities, and indices.

The trend for such markets is evident. The largest sports betting sites in the industry started offering “financial bets” recently so apparently there is a demand for it. Besides that, there are many (some of them somewhat shady) apps and websites promoting prediction marketings for financial products.

There lies a significant potential with one more thing: hedging. In the crypto economy and the blockchain ecosystem, all “assets” of whatever nature cannot be hedged. There are no call and put options (yet). With the possibility of creating a prediction market, there is also the possibility of hedging the price development of underlying assets.