Prediction markets are the cure for social media: Vitalik discusses using real money to combat crazy opinions

【BlockBeats】Ethereum co-founder Vitalik recently shared an interesting perspective on social media: prediction markets are like an antidote that can treat the rampant extreme statements on social media.

He gave an example. Elon Musk once claimed on social media that the British Civil War was “inevitable,” which could easily cause panic. But then look at the prediction market Polymarket’s “Will there be a civil war in the UK in 2024” market, where bettors wager real money, and the market only assigns a 3% probability. How big is the difference? One is alarmist talk, the other is real market pricing.

Vitalik pointed out the problem: social media users casually exaggerate or say “something will definitely happen” to attract attention or create topics, but they are not responsible for these statements. Prediction markets are different—they require real money to bet, and you only earn if you win; if you lose, you lose your stake. This economic incentive makes participants more honest.

As a result, truthful information can be rewarded, and falsehoods can be punished. When you see some sensational prophecy in the news, check the actual odds on Polymarket, and you’ll often immediately calm down. Conversely, prediction markets can also help you identify events that, although not attracting attention, are actually likely to happen. Prediction markets make public opinion aggregation more rational and responsible — something social media cannot do.