Ethereum co-founder Vitalik Buterin said he achieved $70,000 trading predictions on Polymarket last year not by chasing hot-button narratives, but by mitigating what he calls collective “madness.” The Ethereum co-founder defined profit as a function of behavioral reflexes in thin, hype-prone markets, and used the conversation to highlight a distinct concern: the fragility of oracles in settling real-world events.
Here’s how Ethereum’s Buterin made $70,000
In an interview published by Foresight News reporter Joe Zhou on X, Zhou asked if Buterin was still using Polymarket after being active last year. “Yes, I made $70,000 on Polymarket last year,” Buterin replied. When asked about sizing, he said his initial investment was $440,000, implying a roughly 15-year return that stands in stark contrast to the more common retail experience of getting sliced up by headline-driven probability swings.
Buterin described his playbook as an opportunistic mean reversion on sentiment rather than a prediction as such. “My method is simple: I look for markets that are in ‘craziness mode’ and then bet that ‘craziness won’t happen,'” he said.
“For example, there is a market that bets on Trump winning the Nobel Peace Prize. Or some markets predict that the dollar will fall to zero next year in times of extreme panic. When market sentiment enters this irrational ‘madness mode,’ I bet on the opposite, and that usually makes money.”
When Zhou asked where he tends to focus on Polymarket (crypto, politics, entertainment, economics), Buterin said his focus is on politics and technology, and reiterated that the advantage, in his opinion, comes from arenas where participants are “caught up in a frenzy and irrationality.”
The most important part of the thread has shifted from trading style to settlement integrity. Zhou raised the issue of information asymmetries and “advanced knowledge,” referring to online discussions around a Venezuela-linked market and asked whether Buterin had observed similar dynamics. Buterin geared the response toward the oracles’ vulnerabilities, citing a war contract whose outcome depended on a narrow operational definition.
He described a deal on the war in Ukraine that settled on whether Russia “controlled a certain city,” where the smart contract defined “control” as control of the city’s most important train station. The oracle source, he said, was linked to tweets and maps from the Institute for the Study of War (ISW).
Then came failure mode: “ISW employees, perhaps by mistake, or perhaps intentionally, hacked into their own company’s system; their maps were suddenly updated to show that the Russian army controlled the station,” Buterin said. “This caused something that everyone thought had only a 5% chance (almost impossible) to instantly become 100% in the prediction market. Although ISW pulled the update the next day, the money may have already been paid.”
For Buterin, the lesson is not just that prediction markets can be wrong, but that the data supply chain they outsource to can be fragile in ways that crypto participants routinely underestimate. “This reveals a huge problem: The security standards of current Oracle data sources (such as Web2 news sites and Twitter) are too low,” he said. “They never imagined that a single post they made would determine ownership of a million dollars on the blockchain.”
When asked how to solve the oracle problem, Buterin outlined two main approaches. The first is a centralized trust model, effectively designating an authoritative publisher like Bloomberg. The second is symbolic voting, a decentralized mechanism that he associated with the UMA. Buterin said trust in the AMU has declined because of a perceived weakness in game theory: If a coalition of whales can dominate the vote, minority “truth” voters can be punished economically, pressuring participants to reflect power rather than reality.
At press time, Ethereum was trading at $3,010.
Featured image created with DALL.E, chart from TradingView.com
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