Ethereum co-founder Vitalik Buterin stressed that the prediction market is more than just gambling, it is a social cognition tool that can accurately predict future events. He warned against blindly voting for political candidates who claim to support cryptocurrency and should delve into their past positions. 88% of the trading volume in the prediction market is related to elections, indicating that the public uses it to understand consensus. In summary, the prediction market predicts the future by aggregating various opinions, and participants use knowledge and insights to trade, helping to create collective wisdom.
Original title: Vitalik Buterin Defends Prediction Markets Against 'Gambling' Misconceptions
Original article by Gairika Mitra
Original source: shib
Compiled by: Mars Finance, Eason
Ethereum co-founder Vitalik Buterin recently highlighted a common misconception about prediction markets like Polymarket. He strongly disagreed with the idea that prediction markets can be classified as mere “gambling” platforms.
Buterin’s article has attracted the attention of economists and policy experts by demonstrating the important role that prediction markets play and why their importance is growing.
In a post on X (formerly Twitter), Buterin revealed that categorizing Polymarket as “gambling” is a huge misunderstanding. He also expressed concerns about why economists and policy intellectuals are excited about Polymarket.
“Prediction markets are interesting because they are a social cognition tool: the public can learn about the importance of certain events and what is likely to happen, and they are less susceptible to biased editorial opinion than social media or news sites. Conditional prediction markets have applications in governance, and we are already starting to see this,” he said.
His post received mixed reactions. While some people felt that "it was a total gamble", others agreed with his stance.
“I agree that prediction markets offer more than just gambling. Thanks for pointing that out. I didn’t find it particularly interesting because it felt a little better than a DeFi tool to me,” said one user.
Just last week, Buterin acquired a new Ethereum Name Service (ENS) domain “dacc.eth” for 0.187 ETH, worth just under $500. In one of his previous blog posts , he also warned against blindly voting for political candidates who highly value cryptocurrency.
He made some pertinent points in his blog, stating that just because a politician claims to be crypto-friendly now, it doesn’t mean he will always be so in the future.
He also asks readers to dig deeper and find out where the politician stood five years ago. This is also true for some politicians, such as Donald Trump, who was once a vocal critic of cryptocurrencies and now has a friendly attitude towards cryptocurrencies.
Richard Chen, general partner at crypto-centric investment firm 1confirmation, shared a weekly volume chart of election markets versus non-election markets on X. “88% of volume since the beginning of 2024 is election related,” he said, suggesting that a significant number of people are using Polymarket to conduct polls to understand public consensus.
Summarize
Prediction markets primarily predict the future by aggregating various opinions. Participants apply their knowledge and insights when trading contracts based on the predicted outcomes. As a result, this can help create a kind of collective wisdom that provides valuable insights into future trends.
