Trump Widens Lead Over With Biden (on Polymarket and PredictIt) After Courting Crypto Vote

Plus: how much longshot money was made betting on the SEC approving an Ethereum ETF?

AccessTimeIconMay 27, 2024 at 10:04 p.m. UTC

This week in prediction markets:

  • Courting crypto voters appears to have boosted Trump's odds.
  • Doug Burgum still trails behind Tim Scott for Republican VP pick.
  • Longshot ether ETF approval contract prints triple-digit return for bettors, despite disputes over its resolution.

Taking a strong pro-crypto stance may have strengthened Donald Trump's lead over incumbent president Joe Biden – at least if you go by the prediction markets.

In the past week, Trump has promised to commute the sentence of Silk Road founder Ross Ulbricht – a figure near and dear to many in the crypto community – and vowed to make the U.S. a leader in the digital assets industry. It's a markedly more solicitous stance than the Biden administration has taken.

Over the same period, Biden "yes" shares on PredictIt, an election betting platform popular among retail traders that settles trades in dollars, have slipped from 46 cents to 44 cents. Each share pays out $1 if Biden is reelected, and nothing if he loses. Effectively, the 44 cent price means the market sees a 44% chance he will be re-elected.

Crypto-based Polymarket, which technically bans U.S. residents from using its service, has shown a similar shift in the odds.

Trump has gained two percentage points on the platform over seven days, putting his odds at 56%, while Biden is down two percentage points, at 37%.

Polymarket POTUS 5-27-24

The polls have shown neither as dramatic a gap between the two candidates, nor as dramatic a shift in the last week. Trump's polling lead has climbed just 80 basis points, to 1.7%, according to FiveThirtyEight averages. Proponents of prediction markets argue that they can be a more reliable gauge of sentiment and forecasting tool because unlike people answering questions on the phone, bettors have skin in the game.

The markets have also taken an interest in North Dakota governor Doug Burgum as a possible running mate for Trump.

Burgum has been a recent speaker at Trump rallies and the subject of a Wall Street Journal profile where Republican insiders describe him as a "rich guy with rich friends, which goes a long way with Trump."

On Polymarket, Burgum shares are up three percentage points, currently trading at 18%, or 18 cents, while on PredictIt, they are down slightly, trading at 15 cents.

On both platforms, Burgum trails Tim Scott, who's maintaining a lead of 23% on PredictIt, and 27% on Polymarket, well ahead of establish Republicans like Marco Rubio, at 10% on Polymarket, or Nikki Haley, at 4%.

Ether ETF bets pay off bigly

An arcane dispute has arisen on Polymarket regarding the resolution of the contract over whether the U.S. Securities and Exchange Commission would bless ether ETFs. Bettors are clashing over whether "approval" means only the 19b-4 forms or also the S-1 filings.

Rather unexpectedly, the SEC asked last week for updated 19b-4 filings from prospective issuers of Ethereum exchange-traded funds (ETFs). Days later, these filings – critical documents in the approval process – were green-lit by the SEC, stunning longtime analysts. It was thought that the SEC's uncertain view on ether's status as a security would delay things.

But as baseball legend Yogi Berra said, it ain't over 'til it's over.

Although the SEC has approved the 19b-4 forms for the ETFs, it must still approve the S-1 filings before trading can begin, James Seyffart, ETF analyst at Bloomberg Intelligence, told CoinDesk.

"ETFs are not considered 'approved' until both the relevant registration form (such as S-1, N-1A, or N-2) & the 19b-4 filing have been signed off on by the SEC," Matthew Sigel, VanEck's head of research, posted on X (formerly Twitter).

Despite these bureaucratic technicalities, the Polymarket contract, which received over $13 million in bets, still resolved to "yes," meaning the contract's "oracle," or referee, decided the matter was settled.

And that has led to some long-shot money being made.

One user going by the handle Paperliss, who bought in near the bottom of the market at 7 cents, turned just over $300 into $4,358 for a return of 1,329%.

Meanwhile, the largest holder of "Yes" shares in the contract, notgonnatrickme, posted a return of 61%, bringing his or her bet of just over $10,000 to a value of $16,902 when the contract closed.


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