That article doesn't deal with the issue of directly manipulating the thing measured by the success metric (and implicitly assumes that it is unmanipulatable).

To take the example given in the article for bailing out banks and GDP, as soon as the "yes" trades are reverted and the "no" trades are confirmed, we collapse exactly into the scenario many other commentators on this thread have talked about. Now, all holders of negative amounts of "no" tokens are incentivized to decrease GDP in 10 years because this increases their profits at the expense of holders of positive amounts of "no" tokens. The argument is presumably that there is an equal incentive on the other side to increase GDP, but that's a fragile assumption (since in the real world betting market we still see fraud in the direction of those with power, even though in theory you could have fraud "pulling in both directions") and still leaves open the more general fragility-of-value problem (as the article refers to it later on), namely that someone can manipulate GDP but doesn't expose this when betting occurs (which again happens in real-world betting markets), which I'll talk about in a bit.

(Although if someone could explain "after ten years everyone holding the asset on the “no” market gets $26.20 apiece." that would be great, because I think that's a typo and the $26.20 just exchanges hands immediately, or alternatively everyone who's sold the asset gets $26.20 apiece rather than those who hold it? That's however irrelevant for the larger point.)

The problem we're talking about is basically the same one as a problem the article itself points out later.

> A futarchy-as-government, especially if unrestrained, has the potential to run into serious unexpected issues when combined with the fragility-of-value problem... Of course, in reality, futarchies would patch the value function and make a new bill to reverse the original bill before implementing any such obvious egregious cases, but if such reversions become too commonplace then the futarchy essentially degrades into being a traditional democracy.

The problem here can be recast as a version of the fragility-of-value: the value function is no longer accurate because it has/can be manipulated. But the half-solution that the article hand-waves, namely "futarchies would patch the value function and make a new bill to reverse the original bill before implementing any such obvious egregious cases" is doing a lot of work here and should be viewed with a great deal of suspicion.

It's not as relevant for the article, which explicitly points out it's not advocating for futarchy as government (or at least not for all governance rather than e.g. just party selection), which is probably why it's hand-waved away, but if you care about futarchy as government this is extremely important and it is not at all apparent that this "patching" would occur, especially given that the financial incentives are magnified vs a traditional democracy and there is potentially no way of knowing the value function is being manipulated, up until the very moment it is manipulated (and even then it may not be apparent that that is happening!).

In a way, truly solving the fragility-of-value problem is basically solving the same problem as AI existential risk and I would assume most people in the futarchy community agree that the latter problem is a very difficult problem. A failure mode of futarchy can then be thought of as a "monetary AI" completely optimizing for the wrong thing in spirit, even if it's the right thing in letter, e.g. manipulation of the value under measurement.