I was confused as well: After further consideration, I realized that Polymarket only resolves on actual event outcomes insofar as mainstream journalism accurately and credibly reports on those events and their resolution criteria rely on those reports. When it's easier or more reliable to influence reporting around outcomes than the outcomes themselves, bettors will seek to influence the behavior of reporters rather than the behavior of eg. national militaries.

"Iran strikes Israel on March 10" is a difficult outcome to force one way or the other. But "The Times of Israel’s military correspondent or other credible sources reports that Iran strikes Israel on March 10" merely requires intimidating or bribing one journalist. The existence of the bet didn't cause the missile strike or the failed interception. But it did cause a significant, heavily motivated dis-information campaign from people who stood to lose a lot of money.

In a similar way, people fear that prediction markets estimating times of death are equivalent to assassination markets. But murder is an aggressively prosecuted serious crime. It seems that it would be far easier and lower risk to bribe, coerce, pretend to be, or literally be a reporter who got a false obituary published - wait until the "victim" is going to be offline for a few days and can't be contacted to prove they're not dead, trick some tropical country's coast guard into confirming that the victim's yacht exploded offshore, point Polymarket at the obituaries, grab all the crypto, and disappear. If you fail to disappear successfully, your worst crime is publishing a fictional news article/bribing/threatening a journalist. You don't have to risk being in the legal jurisdiction of the victim and getting your hands bloody, you don't even have to be in the same hemisphere: you only need convince the prediction market resolution criteria that something happened.

Scott Alexander wrote about a related issue last month in the colorfully named section [1] "Annals of the Rulescucks", where he described a half dozen scenarios where the outcome may or may not have diverged from the actual event. A bet isn't resolved by eyewitnesses, it's resolved over the Internet through another financial instrument.

[1]: https://www.astralcodexten.com/i/184065379/annals-of-the-rul...