Markets are what you described. Participants that regularly beat the market are rewarded with more money (and confidence) which lets them bet larger size and have more impact on the market.
Uninformed bets should wash out as noise, and informed bettors should reverse uninformed moves so long as they are profitable.
The distinction that I am drawing is the ability use the betting market generate forecasts with greater accuracy than the market itself.
The stock market analogy would be the predictions you could make as an individual if you knew the internal limits and assessments of the best trading firms, and not just current market prices.
If I could pay the NYSE for real time trading info on the buy/sell limits from warren buffet and other whales, I would.
Uninformed bets should wash out as noise, and informed bettors should reverse uninformed moves so long as they are profitable.