Per-Market Information Leakage and Order-Flow Skill: Two Methodological Lenses on Informed Trading in Decentralized Prediction Markets
Maksym Nechepurenko · 2026 · Preprint · SSRN / arXiv
Abstract
April 2026 saw notable methodological convergence in the academic study of informed trading on decentralized prediction markets. Three approaches surfaced almost simultaneously: Mitts and Ofir apply a composite screen to over 210,000 wallet-market pairs; Gomez-Cram et al. apply an event-level sign-randomization test and a separate lifecycle heuristic; and ForesightFlow develops the Information Leakage Score framework. This paper argues that these are three distinct layers of detection, not competing methods on a single layer. Sign-randomization tests persistent directional skill conditional on opportunity selection, rather than insider trading or per-market information leakage. The January 2026 U.S.-Venezuela operation cluster illustrates how lifecycle heuristics, legal investigation, and per-market scoring filter different dimensions. A combined surveillance pipeline gains precision because no layer subsumes the others.
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Cite this work
@online{nechepurenko2026_permarket_ils,
author = {Nechepurenko, Maksym},
title = {Per-Market Information Leakage and Order-Flow Skill: Two Methodological Lenses on Informed Trading in Decentralized Prediction Markets},
date = {2026-05-01}, doi = {10.2139/ssrn.6687418}, url = {https://ssrn.com/abstract=6687418},
eprint = {2605.02287}, eprinttype = {arxiv}, pubstate = {preprint}
}