Vitalik Calls Out Prediction Markets
Plus, crypto markets continue to struggle
Olivia Capozzalo & Denis Omelchenko
February 16, 2026
Happy Monday, Defiers!
Today’s big story:
- Vitalik Buterin shared his vision for prediction markets this weekend, arguing that current designs are leaning into fast, addictive bets that drive volume but offer little long-term value.
In other news:
📈 Markets in the Past 24 Hours
| TICKER | VALUE | 24H | |
|---|---|---|---|
 | Bitcoin | $67,825 | -1.71 % |
 | Ethereum | $1,971.12 | -1.74 % |
 | XRP | $1.49 | -2.21 % |
 | BNB | $612.2 | -1.20 % |
 | Solana | $83.9 | -4.08 % |
Today’s Big Story
Vitalik Warns Prediction Markets Are Slipping into ‘Corposlop’ — But He Has a Vision
Ethereum co-founder Vitalik Buterin recently took to X to warn the crypto industry that prediction markets are drifting off course, not because they failed, but because they found an easy way to succeed.
In an X post on Saturday, Feb. 14, he suggested that many platforms are leaning into fast, addictive bets that drive volume but offer little “long-term fulfillment or societal information value.”
“My guess is that teams feel motivated to capitulate to these things because they bring in large revenue during a bear market where people are desperate - an understandable motive, but one that leads to corposlop,” Buterin wrote.
Prediction markets now have enough liquidity to support full-time traders and can still act as a useful signal alongside news, he noted.
Total value locked and DEX volume across prediction markets. Source: DefiLlama
As The Defiant reported earlier, Polymarket alone traded nearly $3.4 billion in January and about $4.9 billion so far this year, boosted by new five-minute crypto markets that let users bet on very small price moves.
But Buterin argues that this growing focus on short-term crypto prices, sports betting, and similar formats rewards constant engagement rather than insight.
The issue, he explains, is structural. Prediction markets need informed traders who make money and another group that consistently loses. Right now, that losing side is mostly regular users with poor timing or weak assumptions, which encourages platforms to design products that pull in more impulse betting, Buterin notes.
Fraction of traders with positive total profits over time on Polymarket. Source: SSRN
The Defiant previously reported that a recent study found roughly 70% of Polymarket traders lose money, while profits are concentrated among a small group of systematic bettors. The gap has already led to new tools that let users automatically bet against consistent losers instead of trying to follow top wallets.
Buterin says prediction markets need a different purpose to work over the long run. He points to hedging, where users accept small expected losses to reduce real-world risk, such as exposure to elections or future expenses.
Taken further, Buterin links that logic back to prediction markets themselves, calling on platforms to explore “a totally different use case.” People don’t really want stablecoins, he argues, they want price stability, and building crypto on dollar-backed tokens means it is “ultimately not truly decentralized.”
His answer is to “get rid of the concept of currency altogether,” and use prediction markets to offer personalized baskets of shares that mirror a user’s future expenses.
“Build the next generation of finance, not corposlop,” the X post concludes.
Denis, staff reporter at The Defiant
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🎬WATCH
Robinhood’s Crypto Head Johann Kerbrat on Why Public Blockchains Will Win
In this episode of The Defiant Podcast, Cami sits down with Robinhood’s head of crypto, Johann Kerbrat, to discuss the strategic move to build on Ethereum. He believes institutions can get the privacy and compliance guarantees they need on public chains like Ethereum, so building on private chains doesn’t make sense as they are just a “fancy database.”
Watch the full interview:
Top News Since Friday
Crypto Markets Slump Following Disappointing US Jobs Report
Crypto markets opened the week on softer footing, with prices slipping lower as traders digest a Friday jobs report from the U.S. that showed far fewer jobs than expected were added in 2025. Since dropping to as low as $60,000 the first week of February, BTC has mostly been trading in a tight range between $68,000-$70,000.
Why it matters: Analysts at Keyrock argue that BTC is trading as a risk asset, like tech stocks, and “its macro hedge narrative remains challenged.”
MANTRA Jumps 33% after MEXC Supports Token Swap
Less than a year after Mantra’s OM token inexplicably plummeted 90% in minutes, the real-world asset protocol is rebranding OM to MANTRA, and the token rallied 33% on Friday after crypto exchange MEXC announced its support for the token swap.
Why it matters: While MANTRA’s fate remains to be seen, other protocols that have rebranded and migrated tokens have not fared well; Polygon’s migration from MATIC to POL is one high-profile example.
What Happened to Compound’s Crypto Lending Empire?
Compound was once the default answer for crypto lending in decentralized finance. That changed in October 2021, when the protocol’s liquidity began to thin quickly. Its TVL subsequently fell from a high of over $12 billion to around $2 billion, a level around which it would remain to the present.
Why it matters: The protocol is a DeFi OG and raised millions of dollars from prominent VC firms back in 2018.
Trending on The Defiant
- What Happened to Compound’s Crypto Lending Empire?
- MANTRA Jumps 33% after MEXC Supports Token Swap
- Polymarket Launches 5-Minute Crypto Markets and Teases Airdrop
- Lighter Enables Unified Collateral for Spot and Futures Trading
- Tomasz Stańczak to Step Down from Ethereum Foundation
- Truth Social Files for Digital Asset ETFs
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