Ethereum’s tenth year ushers in new prediction market plays

Ten years after it started, Ethereum is powering new ideas like DeFi, NFTs, and DAOs—and now it’s changing how prediction markets work. Last month, platforms like Polymarket handled over $1.16 billion in bets, showing how popular on-chain betting has become. Now, a new platform wants to make these markets even more efficient.

At the recently concluded ETHGlobal Cannes event, developers unveiled PolyBet, ‪an Al-powered, privacy-enforcing smart router that aggregates prediction markets to unify liquidity, optimize bets, and maximize returns.‬

Per the project description, PolyBet aims to address the inefficiencies in the current prediction market system, such as issues of fragmentation, inefficiency, poor execution, and privacy risks. In addition, the system uses Claude AI to rephrase market titles and descriptions, retooling them for different segments across a plethora of different platforms and competitors.

What’s wrong with existing prediction markets?

Present prediction markets today, such as Polymarket, operate in isolation, splitting users, liquidity, and prices across different interfaces. There is no unified view, no best price, and traders are left jumping between platforms to find the best bets, leaving the potential for arbitrage.

As a decentralized aggregator, PolyBet aims to unify multiple betting platforms into a single, privacy-preserving interface. When users place bets, PolyBet does not forward them to one destination. Instead, the platform essentially breaks these bets up, calculates the best execution path based on available liquidity and price impact, and sends them where they will, theoretically, get the best return. 

This process is automated, invisible to the user, and designed to make large bets more efficient without driving up costs. The system is handled by optimization algorithms that consider execution cost, slippage, and available liquidity. 

Another core focus of the project is protecting user identity and activity. PolyBet is built on Oasis Sapphire, a privacy-enabled EVM chain that encrypts sensitive data like wallet addresses, bet sizes, and positions. Unlike typical dApps where everything is public, PolyBet keeps all activity confidential.

Authentication is facilitated through SIWE (Sign-In With Ethereum), and the entire bet lifecycle from deposit to settlement is kept confidential. This matters in prediction markets, where users may be wagering on sensitive political or financial outcomes. 

Zooming out, the crypto-backed infrastructure powering platforms like Polymarket and PolyBet runs on blockchain networks. All transactions are done in crypto, primarily USDC (USDC). Users connect a wallet and place trades through smart contracts, no middlemen, just direct, transparent settlement.

But the question remains: are these tools just facilitating degenerate gambling on political outcomes, or is there something deeper at play?

According to The Block’s prediction market aggregator, Polymarket saw $1.16 billion in trading volume in June 2025, its second-highest month ever. At its peak, in November 2024, monthly volume reached $2.6 billion. Total trading volume on Polymarket has now surpassed $4.5 billion, making it the world’s largest decentralized prediction platform.

In addition, Polymarket is backed by leading industry voices like Ethereum co-founder Vitalik Buterin, who have shared the potential for these platforms to evolve from mere betting venues to reshaping how people access real-world information through markets. Buterin backed Polymarket in its Series A, but a more recent $200 million funding round has seen the platform grow significantly.

New market creation is surging too. In June, roughly 7,990 markets were launched on Polymarket, a 21.4% increase from May. That spike in activity hints at growing demand and engagement, particularly as high-stakes global and political events play out.

Leveraging prediction market arbitrage

But PolyBet’s automation goes even further. The platform actively scans for arbitrage opportunities by identifying price inconsistencies across all integrated prediction markets. Rather than restricting itself to straightforward two-market arbitrage, PolyBet is capable of executing complex, multi-step strategies—such as buying “YES” shares on one platform while selling “NO” on another at a profit. These risk-free trades, generated by closing market inefficiencies, can further enhance liquidity across the platform or be distributed among users, reinforcing PolyBet’s value proposition as a smarter aggregator and executor within the prediction market landscape.

PolyBet’s arrival marks more than just another incremental improvement—it’s a leap forward in how prediction markets can operate. By automating market discovery, tailoring content for distinct audiences, and executing sophisticated arbitrage strategies, PolyBet showcases a blend of technical and user-centric innovation rarely seen in the space. An approach that can unify fragmented liquidity and improve privacy; thereby enhancing overall market efficiency and engagement, making prediction markets more robust and accessible for all users.

As major players like Polymarket draw billions in activity and influential voices like Vitalik Buterin champion the transformation of these markets, the sector is clearly evolving past the stereotype of mere speculative gambling. With the intelligence and automation brought by platforms like PolyBet, prediction markets are poised to become powerful tools for aggregating and acting on real-world information—offering both greater utility and a more inclusive experience for everyone interested in the future of decentralized betting.