The following assume the prediction markets are being used to help evaluate the standing of government bureaucrats or employees in another very large organization. In this instance, the resource being bet is not currency per se, but a “credibility score” used in hiring and other decisions.
Reselling Shares of Predictions
One issue with making bets is that they may take longer than your lifespan in order to pay out. Shares of bets on, for example, global temperature in the year 2100 should be something that can be traded by itself. In this sense these kinds of bets become a long-term investment that can be used to hold one’s credibility score, particularly if bet payoffs are indexed to prediction market inflation.
Catastrophe Bets Reserve Catastrophe Goods
A basket of catastrophe goods are held in reserve for those who make predictions of incidents which would cause the prediction market to end. This might include gold, guns and ammo, priority access to bunkers, and so on. These would be distributed by the market operator in preparation for the event, but are only held by the bettor unless the actual catastrophe kicks in.
Prohibition of Close Involvement
Based on the level of control someone has over the outcome of a scenario being bet on (1/N?), they may be prohibited from betting on it.
Alternatively,
Prohibition of Betting Against Own Success
If you’re on a project, you can only bet on it succeeding, not coming late or failing. Colluding with outsiders to get payment for the project failing is a punishable offense, and these will be monitored and punished.
Alternatively,
Randomization of Selection of Betting Participants with Self Recusal
Spread bets over the organization at random to lower the probability that any participant has too much control over the outcome and is thus able to sabotage it. This may result in a hit to accuracy, depending on the estimating capabilities of your organization.
There are probably other mechanisms that can be added to try and get better / less corrupt behavior from the prediction markets.