As the United States was gearing up for the November 5 presidential election, a significant wave of crypto investors, known as “whales,” bet millions on a Trump victory in decentralized prediction markets. For high-stakes political wagers, these markets have become a popular space, where investors use cryptocurrency to place bets on political outcomes.
A Few Large Players Bet on Trump
On a leading decentralized prediction platform, Polymarket, over half of the “Yes” votes for a Trump win were controlled by just five major investors, also called “whales.” According to Domer, a well-known pseudonymous political bettor, these whales were believed to have collectively acquired 50% of the Trump “Yes” shares, worth millions of dollars.
Domer noted in an October 31 post on X:
“Trump Yes shares are very highly concentrated. 5 fat cat accounts own 50% of the 162 million shares — including the Le Giga Whale with nearly 1/3rd by himself. Those 5 will be paid out $81 million if Trump wins.”
According to Domer, this setup was very different from Kamala Harris’s shares where her shares were spread across a larger number of smaller investors, with the top five holding just 18%. Harris’s largest shareholder controls only 4.4% of her shares, while Trump’s top shareholder holds a whopping 29.1%.
Only One “True Believer” Whale?
Suspicions arise that at least four of the top six Trump bettors may be controlled by a single investor who has high confidence in Trump’s victory. Domer speculated:
“My guess is it is a true believer who is very rich and trying to make a big bet. He is getting more confident as the price goes higher and is in a confirmation bias loop where new information keeps increasing his confidence.”
Trump Leading in Crypto Markets but Not in Traditional Polls
While Harris held 43% chance of winning on Polymarket,Trump had a 56.9% chance according to Polymarket’s odds. On another betting site, Kalshi, Trump’s odds stood at 54%, with 46% favoring Harris.
However, traditional polling offered a different perspective with The New York Times’ polling data showing Harris, slightly leading, with a 49% versus Trump’s 48%. Billionaire Elon Musk pointed out that prediction markets, where people invest real money, may offer more accurate predictions than traditional polling methods, since participants have a financial stake in the outcome.
Bitcoin’s “Trump Pump” Effect
The fluctuations in Polymarket odds also had effects on the Bitcoin market. As Trump’s odds rose, Bitcoin’s price reached $73,600 on October 29, 2024, close to an all-time high. Some experts have called this a “Trump pump” — the idea that Bitcoin’s price is rising due to Trump’s rising odds. An analyst at BRN, Valentin Fournier, explained:
“At the end of last week, newly released polls showed Harris with a narrow 2–3% lead. Given Trump’s pro-crypto stance and his ambition to position America as a digital asset leader, his potential loss is perceived as a short- to medium-term setback for Bitcoin’s growth potential. This political shift has contributed to recent profit-taking, reinforcing Bitcoin’s ongoing price correction.”
Other analysts argue that Bitcoin’s recent rally is more of a “Trump hedge”, or a response to the possibility of his victory, rather than an indication of long-term growth due to strong macroeconomic factors.
What’s Next?
Crypto prediction markets remain a hot spot for election betting as political uncertainties unfold. With millions on the line and whales betting big, the outcome of this election is set to have a significant impact on crypto markets and regulatory outlooks for years to come.
And as it is now, the crypto community expects the bullrun to kick off as Donald Trump has won the election.
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