I got the horse right here, reloaded

Back in July there was a big scandal over DARPA’s funding of a futures market where people bet on things like whether Arafat will be assassinated or when the US will pull out of Iraq. The project was canceled, and also became the straw that forced John Poindexter’s resignation. Now the Guardian reports that San Diego-based Net Exchange, the company that was implementing the project, is going ahead and launching it without government support or involvement. Given the previous uproar, Net Exchange is being understandably quiet about the whole thing.

Personally I’d be happy to see them try this out. As I said before, the U.S. Government shouldn’t be involved in something as shady as gallows gambling, but as a private experiment the whole thing intrigues me and I don’t have a problem with seeing where it goes. My guess is it will wind up being an interesting past-time for armchair analysts, but like most markets will fluctuate far too much to provide any real security data. The only real danger I see is if the stakes get high (unlikely) and attract corruption — unlike sports gambling or its Wall-Street counterpart, Middle-East politics has neither conflict-of-interest nor insider-trading laws. The more likely danger is simple lack of interest, the risk all seemed-like-a-good-idea-at-the-time Internet projects face.