Author: Matou, Da Da Luosi
Prediction markets might be the only field in 2025 that can simultaneously excite distinguished dollar fund investors, crypto bros, and media professionals.
There are actually many reasons to be optimistic about it, such as the arbitrage between state and federal regulations for gambling in the US, the massive transaction fees driven by the extreme extrapolation of 0DTE, and the convergence of content industries with light betting, and so on.
But let's not talk about those today. Let's change direction and discuss the spirit behind prediction markets, and how this spirit aligns with a16z, which waves the banner of "New Media," making it one of the most crucial pieces in its new media empire.
The Chronicle of the Prediction Market Spirit
The product of a prediction market is simple (or so it seems on the surface): it turns the object of a binary option bet into any event or information. But in reality, its underlying spiritual core has gone through several periods of transformation.
The earliest discussion about prediction markets actually came from Friedrich Hayek. In his view, knowledge is unevenly distributed, and the market, as a coordinating mechanism, mobilizes information from the furthest reaches of society—from vendors to experts. Different people's judgments about the future converge into a price on the order book within the prediction market.
This discussion is the oldest, but it's also the one most frequently mentioned today. When you see terms like "probability aggregation market" or "truth machine" on marketing blogs, they all originate from Friedrich Hayek's "The Use of Knowledge in Society," written nearly a hundred years ago.
The torch was then passed to Robin Hanson after Hayek. The elder scholar is still highly active on X, battling with crypto bros. His main contribution lies in designing a system called the Logarithmic Market Scoring Rule (LMSR), which makes it more beneficial for those who know the truth to speak it. This design essentially established the paradigm for current prediction market design.
With such an incentive mechanism, information holders in various corners have the motivation to contribute their information and participate in the market. Extending this further, it seems such markets could also be used for public governance. By opening a market for every future issue and having people vote with real money, the future landscape would be constructed in the changing odds on the order book. This utopia is called "Futarchy," composed of "future" and the suffix "-archy," denoting a form of government.
Foundational Work: "The Logarithmic Market Scoring Rule for Modular Combinatorial Information Aggregation"
The above constitutes the official, orthodox history—the kind you'd find in a university microeconomics textbook timeline. But I believe metaphysical discussions about prediction markets after this point were largely meaningless until a16z turned its gaze to this field.
Presence and New Media
a16z came into contact with the prediction market company Kalshi in 2024 and then invested in its $5 billion round in August 2025. It's currently unknown if there was a discount. Now, Kalshi's valuation has reached an astonishing $22 billion and is called one of the fastest-growing companies (in valuation) outside of AI firms.
After taking a position, a16z mobilized its media machine, writing a series of long articles explaining why Kalshi is one of the most important companies of our time. Honestly, while the exchange and casino business is attractive, due to potential regulatory pressure and moral risk, it never commands a very high PE multiple in the market. Clearly, a16z's vision extends beyond that.
So, what is truly important about Kalshi, or the entire prediction market track? The answer a16z gives is "Presence."
At the current point in time, people's contact with the world is actually separated by a layer of plastic film, somewhat like you can only browse the front end of a webpage but know nothing about its backend construction. You can consume the front-end audiovisual experiences, narratives, and even "real feelings," but you cannot change or be present.
Not to mention, obviously in the not-too-distant future, even the transformation of the real world will gradually be outsourced to agents. So, what is humanity's role in the historical process? It seems we are only left to bury our heads in light-colored sheets and cry after eating and drinking our fill.
But prediction markets offer a method of intervention called prediction. It requires you to bet with real money, then, like buying a ticket to enter a stadium, participate and observe the fluctuation of probabilities throughout the process, willingly endure theta decay, and also screenshot the prediction market probabilities, forward them in all group chats, and loudly declare your position and the views behind it.
This feeling is very anti-cynical. In an instant, the infinite distance, the endless people, the choice of the cardinal, the depth of snow in New York, the rise and fall of crude oil within five minutes, and even whether Jesus will return in 2026, all become relevant to you. All the uncertainty and powerlessness of postmodernity collapse under your powerful prediction. You are no longer a gambler; you are a distinguished super-observer, a prophet of your tribe, a calm bystander of history.
When enough people start using, discussing, and relying on this medium, the authority of the market itself begins to rise. Kalshi will grant the final interpretive power over events regarding: 1. Authenticity and 2. Importance. This is undoubtedly a key component in the new media empire envisioned by a16z.
One chart explaining Charlie Kirk's assassination
Case Study: MTS
Finally, let's talk about this new media as defined by a16z. In fact, from the first-generation In-house Media advocated by a16z and YC, to the second-generation VCs that grew out of media like 20VC and Not Boring Capital, and finally to media like TBPN being acquired by companies and institutions, the power of media has been constantly shifting and decentralizing. The battlefield of public opinion has also moved from blogs and TV shows to X and podcasts.
Talking about VCs also needing to create content and build brands, helping founders with distribution, is already utterly unoriginal in 2026. The new media a16z talks about is a full-spectrum project, covering everything from upstream narrative setting, midstream product financing and promotion, to downstream customer acquisition—all within its scope, and at a speed far beyond what traditional media and agencies can comprehend.
What used to take 3-6 months to complete as a planning project, new media will accomplish in a few weeks: founder podcasts, short video clips, AI-generated launch videos, newsletters about the company's spirit and development plan, etc. They release information with extreme intensity in an extremely short time frame, calling it "taking over the timeline."
Perhaps various self-media and AI-generated information are too noisy, so we just have to be noisier. And our noise is more important than yours.
The media company MTS (full name "Monitoring The Situation") embodies this philosophy, conducting 24/7 live news broadcasts on X, bringing a series of political figures, tech company founders, and key figures from hot news topics onto the mic, then slicing and disseminating the content. They claim to only report on the most important thing happening in the world right now, until the next more important thing occurs.
MTS interviewing Robinhood
Looking back at Kalshi, everything seems to fall into place. Relying solely on clout and a16z's endorsement, media like MTS can certainly survive, but their influence outside a16z's sphere remains limited, more like a fraternity media outlet or a campus club publication. But prediction markets are different; the trading volume and positions on them are backed by real money, seemingly possessing a certain independent, third-party, cold, authoritative quality and persuasive power.
Imagine, if you were a staunch MAGA supporter, at the time of the midterm elections, you saw that the Republican victory market on Kalshi had already reached tens of billions of dollars in trading volume, but the price of the YES option for victory had dropped to $0.1. Wouldn't you waver for a moment—do the Capitol Hill elites already know the outcome? Has the fair information market already painted a picture of the future?
This is perhaps the core reason why Kalshi is worth $22 billion. This reality distortion field has not often been obtained by a private company in human history.
TBPN New Media Landscape
References:
[1] Alex Danco, “Prediction: the successor to postmodernism,” Andreessen Horowitz, October 10, 2025.
[2] Alex Danco, “Prediction Path Screenshots: A New Kind of Meme,” Andreessen Horowitz, October 10, 2025.
[3] F. A. Hayek, “The Use of Knowledge in Society,” The American Economic Review, Vol. 35, No. 4, pp. 519–530, 1945.
[4] Erik Torenberg, Ben Horowitz, and Marc Andreessen, “a16z’s New Media Playbook,” Andreessen Horowitz Podcast, February 27, 2026.
