The post Prediction Markets face reset as Buterin urges hedging appeared on BitcoinEthereumNews.com.

Prediction markets should pivot from speculation to risk hedging Ethereum co-founder crypto-millionaire/vitalik-buterin-net-worth-2024-update/”>vitalik buterin has urged a redesign of prediction markets toward risk hedging for everyday expenses and business exposures, as reported by Cointelegraph. His vision includes markets tied to price indices by region and category, with local AI assembling personalized baskets that offset expected spending shocks. He has also argued that non–interest-bearing collateral makes these platforms unattractive for hedgers who would otherwise earn yield elsewhere, as reported by The Block. That design gap can push platforms toward short-term wagering instead of long-horizon financial utility. Why the shift matters for utility, incentives, and users Hedging reframes prediction markets from entertainment to functional risk transfer. Consumers facing inflation or volatile bills, and institutions with event-driven exposures, could use event contracts to reduce variance rather than chase returns. Supporters argue that better incentives, collateral design, and index-linked contracts can realign these venues with societal value. “Prediction markets are ‘over-converging to unhealthy product-market fit: embracing short-term cryptocurrency price bets, sports betting, and other similar things that have dopamine value but not any kind of long-term fulfillment or societal information value,’” said Vitalik Buterin, Ethereum co-founder, as reported by MEXC News. Institutional interest also centers on risk management rather than speculation, as reported by Business Insider. Some investors view these markets as complementary signals for macro, geopolitical, or corporate event risk where conventional derivatives offer incomplete coverage. BingX: a trusted exchange delivering real advantages for traders at every level. Immediate impacts for Polymarket, event contracts, and CFTC context For platforms such as Polymarket, a hedging-first pivot would emphasize contracts mapped to measurable economic exposures, examples include regional inflation, transportation costs, or energy price pass-through. Product success would likely hinge on deeper two-sided liquidity, standardized settlement, and verifiable data sources to prevent manipulation. Regulatory clarity is…

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Filed under: News - @ February 16, 2026 5:29 pm