Research Summary: From Public Evidence to Contractual Outcome: First and Stable Decidability on Kalshi

This research introduces the concepts of 'first decidability' and 'stable decidability' within prediction markets, specifically referencing the Kalshi platform. These concepts define the earliest point at which public evidence is sufficient to settle a contract and the earliest point at which this determination remains unchanged through finalization, respectively. A retrospective identification test and a blind pilot study were conducted to establish the feasibility of these concepts, with positive outcomes regarding identity recovery and rule text validation.

Why it matters

This research is strategically important as it introduces formalized concepts for determining definitive contract settlement in prediction markets, addressing ambiguities arising from evolving evidence. Establishing clear 'decidability' metrics can enhance the reliability, transparency, and trust in such platforms, potentially influencing operational standards for financial or information markets that rely on external evidence for contract resolution.

Key insights

• Public evidence can be sufficient to settle prediction market contracts before official venue determination.
• The timing of contract settlement depends on factors such as rule versions, release objects, source hierarchy, correction history, and unfinished contract conditions.
• The research defines 'first decidability' as the earliest contemporaneous singleton in the rule-evidence mapping.
• It defines 'stable decidability' as the retrospective earliest time after which the same singleton determination remains unchanged through finalization.
• A completed retrospective identification test demonstrated narrow feasibility for these concepts.
• A frozen blind pilot successfully recovered current rule text and passed identity and blinding checks for all 25 instances.

Source

arXiv — Computers and Society — https://arxiv.org/abs/2609.16642