- Vitalik Buterin profits on Polymarket.
- The Ethereum co-founder takes the other side of high-risk bets.
- He previously made $58,000 betting on the 2020 US election.
Being boring has never been so profitable.
That’s the lesson coming from Ethereum co-founder Vitalik Buterin, who said he profited $70,000 on prediction market Polymarket last year by taking the other side of long-shot bets.
“My approach is simple: I look for markets that are in ‘crazy mode’ and then bet that ‘crazy things won’t happen,’” Buterin said in an interview with Singapore-based media outlet Foresight News, published on Wednesday.
“If you want to make money, you need to go into those markets where people are caught up in crazy and irrational predictions; that’s where you can make money.”
Buterin’s strategy, while successful, isn’t producing the eye-watering returns that usually grab attention among crypto traders.
To make $70,000, Buterin said he bet around $440,000 in principal, meaning he earned just under a 16% annual return on his bets.
Prediction markets, platforms where traders can bet on the likelihood of future events, have surged in popularity over the past year.
Many crypto traders have shifted their focus towards betting on events as Bitcoin and other tokens stall, while prediction platforms like Kalshi compete with traditional sportsbooks in the US.
Last week, prediction markets saw $6.2 billion of notional trading volume, up from less than $500 million a year ago, according to data compiled by datadashboards on Dune Analytics.
Good targets
Buterin has long praised prediction markets for their ability to get closer to the truth than other mediums.
He argues that they force participants to attach real financial stakes to their beliefs, which incentivises accuracy over empty rhetoric. Because of this, prediction markets are less vulnerable to bias than news or social media, he said.
It’s not the first time Buterin has talked publicly about his Polymarket bets. The Ethereum co-founder previously said he made $58,000 betting on the 2020 US presidential election.
Buterin didn’t say which specific markets he had made the most money betting on recently, but he did give some examples.
Those who bet on President Donald Trump winning the Nobel Peace Prize, or who predicted the US dollar would collapse, were good targets to bet against, he said.
Buterin’s strategy contrasts with those of other successful prediction market bettors, who often seek out higher returns by going against the crowd.
Domer, a former professional poker player, is among the most well-known bettors. He made a name for himself over the years by correctly guessing Sam Bankman-Fried would receive a 25-year prison sentence and that Sam Altman would be fired as CEO of OpenAI.
He’s also lost some big bets too, such as the time he bet US regulators would not approve Ethereum exchange-traded funds.
Last year, Domer said he made $100,000 by correctly predicting who the Sacred College of Cardinals would elect as the next pope, despite the market giving Cardinal Robert Francis Prevost only a 5% chance of ascending to the papacy.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
