Andrew Ross Sorkin (Co-Anchor of Squawk Box) 00:00.070
joining us now in a first on CNBC is the company CEO of lad ten of lad always good to have you why why are you doing this
Vlad Tenev (Co-Founder, Chairman and CEO) 00:10.010
yeah so last night we dramatically expanded our prediction markets offering in a couple of ways one of the things is just making them available for people that aren't just interested in trading but also want to see the information and we we talked about how a year ago we had one
Vlad Tenev (Co-Founder, Chairman and CEO) 00:28.970
prediction market on the site and it's grown to thousands we think we're in the early stages of a prediction market super cycle where the amount and volumes traded in this new asset class are going to grow tremendously we're increasingly seeing them used not just as a tool for
Vlad Tenev (Co-Founder, Chairman and CEO) 00:48.150
traders to speculate but also as a new source of information let me give you an example your previous segment you were talking about the warner brothers merger with paramount and netflix now i think that the question on everyone's mind with something like that is what's the
Vlad Tenev (Co-Founder, Chairman and CEO) 01:07.670
likely outcome who if anyone will end up acquiring warner brothers and we have a prediction market on robin hood that answers and addresses this exact question the interesting thing is last night if you look back twenty four hours ago we had on our market paramount with fifty
Vlad Tenev (Co-Founder, Chairman and CEO) 01:27.270
five percent chance and now i just checked while i was watching your segment seventy five percent chance and i think we can try to decipher this by looking at the various stock prices of the companies as as you guys have shown but really prediction markets i think are ultimately
Vlad Tenev (Co-Founder, Chairman and CEO) 01:43.670
going to be most valuable as a better forecasting tool where you don't have to worry about modeling out the exogenous effects of all sorts of factors on a company 's stock price and you can actually get the direct answer to a very specific event and and i think that's just one
Vlad Tenev (Co-Founder, Chairman and CEO) 02:00.800
of the reasons why were in the early stages of a super cycle in this new asset class and why robin hood is is continuing to push forward with the best products for traders and for for people using it as a source of news and information vlad
? (Reporter) 02:16.070
you're absolutely right in that it's getting used a lot i mean it's showing up in sell side analyst reports everyone sort of coming to it as a new source of information but i wonder what you think the actual predictive powers of these markets are i mean we've all seen a chart of
? (Reporter) 02:31.670
i mean my favorite will beyoncé show up at the super bowl and odds are low and then two seconds before she comes on stage and it goes to ninety five ninety nine percent what's are those who has an edge on these things
Vlad Tenev (Co-Founder, Chairman and CEO) 02:46.150
i mean i think that there's a such a wide variety of prediction markets and of course you can probably come up with examples that might look silly to to to pretty much anyone but i think the power of it is we can get a real time exchange traded price and forecast on pretty much
Vlad Tenev (Co-Founder, Chairman and CEO) 03:04.550
anything and what we found is talking about traders what this allows traders to do is hyper specialize on one specific thing so so you know there's probably one area where each of us is sort of a unique expert be it AI technology gaming music entertainment and this allows you to
Vlad Tenev (Co-Founder, Chairman and CEO) 03:28.590
actually trade and specialize and while you're trading you produce this this valuable forecast so i mean we we talked to customers all the time some of them are very very scientific about these things and they just collect all the information they study it deeply and they they
Vlad Tenev (Co-Founder, Chairman and CEO) 03:46.990
feel like they have the tools and the knowledge to go against conventional wisdom and trade on the things where where they may have a unique edge