In the past, everyone was trading spot and playing contracts,
but smart money has quietly flowed into prediction markets.
👇 An article that clearly explains the play of 'zero-risk arbitrage + airdrop ambush'.
1️⃣ What is a prediction market?
Betting with funds on whether an event will occur. Participants bet on the outcomes they believe in, and the prices are aggregated in real-time to form a consensus of public probability.
For example:
• Will ETH drop below $3400 in October? • What decision will the Federal Reserve make in October? • What will the price of Bitcoin reach in 2025?
Each event is broken down into a 'YES / NO' bet.
Price represents probability (0.25 = 25% possibility).
2️⃣ Market attention and investment enthusiasm?
• VC heavily invested in prediction market projects • US regulatory attitude turns to relaxation (Polymarket approved to return to the US) • Trading volume surges • The market sees prediction markets = 'probability-based financial markets' • cz focuses on prediction markets
3️⃣ Polymarket leads on-chain, valuation leads
Financing accumulates to 2.279 billion USD. All tokens and settlement transactions have sub-second confirmation. Each YES/NO share is fully guaranteed by 1 USDC. On-chain liquidity + ICE endorsement.
4️⃣ Arbitrage logic (non-contract play)
This is not using leverage to trade volatility, but using probability for hedging.
👉 Bet on an event on Polymarket
👉 At the same time establish a reverse position on spot/perpetual exchanges
Result: Regardless of the event's success or failure, profits and losses are locked within a controllable range.
5️⃣ Arbitrage operation
ETH current $4052
Event: What will the price of Ethereum reach in October?
‘ETH drops below 3400’ odds 5.9x
Bet 1000 USDC
If ETH drops below → Win 4949.87
If it hasn't fallen → Lose 1000
At the same time, hold equivalent hedging positions on exchanges, just buy equivalent ETH or hold equivalent long positions.
Profit and loss result:
Prediction successful, Polymarket won 4949.87, hedging position lost betting principal 1000, profit greater than loss.
Prediction failed, Polymarket lost 1000, hedging profit at least 1000, revenue and loss balance (no risk)
I made a 📊 Polymarket arbitrage hedging calculation sheet
Input current price, target price, odds, principal →
Automatically calculate hedging position, margin, profit and loss comparison.
📥 Download: Leave a message
6️⃣ Hedging principle:
Regardless of rise or fall, overall close to 0.
You are not betting on the market, but on the odds difference for arbitrage.
What you earn is the market's probability error.
7️⃣ Hidden benefits: Air drop expectations 💰
Polymarket is an on-chain project,
Bets, cancellations, bridging, and active trading are all recorded on-chain.
These interactions may become future air drop scoring factors.
While you are arbitraging, you are also mining air drops.
9️⃣ Practical suggestions:
1️⃣ Register on Polymarket 2️⃣ Deposit USDC from the blockchain
3️⃣ Bet on familiar events (such as ETH, BTC)
4️⃣ Control maximum loss of hedging position = Betting principal
5️⃣ Keep on-chain interaction records, waiting for air drops
Summary:
Prediction markets are the new engine of DeFi 2.0.
When others are still predicting,
smart people are already arbitraging.
And the smartest people,
are mining air drops while arbitraging.
