Prediction Market for DAOs

By providing variety of voting power calculation mechanisms does not automatically increase engagement, ensure a great voting turnout, or cover all decisions that needs to be made by DAOs.

ParaDAO leverages prediction markets to encourage participation in different forms.

Voting

To encourage voting, a Prediction Market overlaying proposals can improve the incentives for members to engage.

For example, let's say there are 2 active proposals for funding from the treasury with the purpose of increasing DAO treasury,

1. social media advertisement to increase members,
2. provide liquidity with tokens in the DAO treasury,

The DAO can create a prediction market which has the same market opening times as the proposals with the question,

"Which strategy will likely bring the most revenue to the DAO treasury in 3 months?"

The Outcome Asset Tokens will then be Strategy1, Strategy2, None.

A DAO member may decide to purchase Strategy2, believing that it will work to a certain degree. They would then vote yes to fund that proposal and no to not fund the other one.

Similarly, if a member do not believe any of them will work, they can purchase the None OAT and vote no to all two proposals.

The earlier the members or even non-members enter the prediction market, the more they are rewarded compare to late comers. They would also want to vote on the proposal to ensure their options will be Passsed.

Content promotion

For example in the case of a Fanclub, there can be prediction market created by the star / members on content, i.e. "The new music video released in June 2022 has been shared more times than the one released in Jan 2022 by 31st Aug, 2022".

In this case, people might choose to purchase the Outcome Asset Tokens that align with which video they like more, it may also be the case that they help share the content to promote its circulation.