Crypto’s Election-Prediction Money Machine | Bitcoin Billionaire Cash Out

Blockchain-based betting site Polymarket has found mainstream success thanks to massive wagers on U.S. elections.

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Nina Bambysheva Staff Writer, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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A BILLION DOLLAR PREDICTION MARKETPLACE

What are the chances that Vice President Kamala Harris will defeat former President Trump in November? On the blockchain-based website Polymarket, it's 39%, according to thousands of bets totaling $446 million. Despite the U.S. ban on election betting—deemed against the public interest by the Commodities and Futures Trading Commission—Polymarket thrives as a prediction market phenomenon, fueled by the world’s fascination with American politics.

Based in New York City, Polymarket has already surpassed $650 million in trading volume this year, with nearly $300 million in July alone, according to Dune Analytics. It’s projected to process $1 billion in wagered predictions by year’s end. Campaign managers and political analysts now look to this unconventional oracle for insights. Even former President Donald Trump has touted his Polymarket odds on his social media app, TruthSocial.

In an exclusive interview with Forbes, Polymarket’s 26-year-old founder and CEO, Shayne Coplan, discussed how his team transforms “internet yelling matches” into a high-stakes information powerhouse.

CRYPTO BILLIONAIRES ARE SELLING HIGH

The billionaires whose fortunes are tied up in publicly traded crypto firms Coinbase and MicroStrategy have sold a combined nearly $850 million worth of shares in the last nine months.

Michael Saylor, the founder and CEO of MicroStrategy, a software firm that has invested heavily in bitcoin, sold $362 million of MicroStrategy shares since the start of 2024, according to regulatory filings. Brian Armstrong and Fred Ehrsam, cofounders of Coinbase, the most popular crypto exchange in the U.S., sold $216 million and $270 million of Coinbase shares, respectively, between last November and late July, filings show.

These sales coincide with a rise in cryptocurrency prices. Bitcoin, the largest cryptocurrency, recently hit around $70,000—more than double its value a year ago—before sliding to $64,574 on Thursday.

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CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$64,574

0.1%

Ether (ETH)

$3,170

2.3%

Tether (USDT)

$1.00

0.0%

Binance Coin (BNB)

$570

1.7%

Solana (SOL)

$165

0.7%

Sources: Forbes Digital Assets, CoinGecko. Prices as of 4:55 p.m. on August 1, 2024.

TETHER POSTS RECORD-HIGH PROFIT

Tether, the operator of the largest stablecoin USDT, reported a net operating profit of $1.3 billion in the second quarter, largely due to interest from its U.S. Treasury holdings, despite a decline in bitcoin’s value. For the first half of the year, Tether’s profit reached a record $5.2 billion, according to the company. USDT’s market capitalization has climbed above $114 billion as demand for the stablecoin surged during this year's crypto rally.

LIBRA CREATOR DAVID MARCUS ENDORSES TRUMP

David Marcus, creator of Facebook’s short-lived stablecoin project Libra (later known as Diem), endorsed Donald Trump ahead of the November presidential elections. In a post on X, Marcus described his political shift, citing key issues central to Trump's platform. “I believe we need a president who is unequivocally pro: America, the Constitution, business, Bitcoin/crypto, innovation, Israel, small government, legal immigration, free speech, meritocracy and common sense—and anti: regulatory proliferation, illegal immigration, unjust wars, Iran’s current regime and domestic groups that oppose American values,” Marcus wrote.

Meanwhile, Vice President Kamala Harris’s team has reportedly reached out to crypto spokespeople following President Joe Biden’s announcement that he would not seek reelection and endorsed Harris as the Democratic Party’s nominee.

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