TechFlow News, January 28: According to the latest interview by Foresight News, Ethereum co-founder Vitalik Buterin revealed in a conversation with Joe Zhou that he invested $440,000 on Polymarket last year and earned $70,000 in profits. Vitalik’s strategy is straightforward: identify prediction markets that have entered “crazy mode,” then bet against the “crazy” outcomes. For instance, when markets feature extreme predictions such as “Trump will win the Nobel Peace Prize” or “the U.S. dollar will hit zero next year,” he bets on the opposite outcome—a contrarian investment approach that often yields profit.
Vitalik also shared a case study involving an oracle vulnerability: In a prediction market concerning the Ukraine battlefield, an erroneous map update from the data source—the Institute for the Study of War (ISW)—caused an event originally assigned only a 5% probability to suddenly be marked as 100% certain, triggering market chaos. He noted that current oracle solutions fall into two categories: centralized models relying on trusted institutions like Bloomberg for information, and decentralized models employing token voting—such as UMA’s protocol. However, Vitalik pointed out that UMA’s model suffers from game-theoretic flaws: large holders may collude to manipulate voting outcomes, leaving ordinary users unable to counteract such influence. Presently, the DeFi industry widely relies on Chainlink, though its mechanism is relatively complex and centralized. Vitalik emphasized that trustworthy oracles are critical for DeFi and for tokenizing real-world assets, and that the industry still needs to discover better solutions.
