Bitcoin's move above $50,000 on Monday brought windfall gains to holders of the Yes side of Polymarket's now-expired "Will BTC hit $50,000 in February?" contract.
Pseudonymous trader u/MeLLoN98 made 550% and is now betting on the bitcoin price reaching a record high by the end of the first quarter.
Gone are the days when making big money in the crypto market required taking directional bets in the spot or futures markets or setting up complex decentralized finance strategies. Some traders are now generating market-beating returns through the decentralized prediction platform Polymarket.
A recent example: The pseudonymous u/MeLLoN98, a core contributor on Reddit's r/CryptoCurrency community, earned a staggering 550% return on investment after buying more than 90,000 shares in the Yes side of Polymarket's now-expired betting contract "Will BTC hit $50,000 in February?"
The contract resolved to Yes on Monday after bitcoin (BTC) rose past $50,000 on the Nasdaq-listed Coinbase (COIN) exchange, hitting the highest since December 2021. Speculators on Polymarket can buy or sell outcome shares, which can be redeemed for $1 if the outcome is correct.
"I converted 110,000 Moons to 14,000 USDC on Kraken and bought 91,409 shares on Polymarket at an average price of about 15 cents. So I paid $14K and got $91.4K," u/MeLLoN98 told CoinDesk in an interview conducted over X. MOON is the native token of the r/CryptoCurrency community, which has 7.4 million users.
MOON ERC-20 tokens are distributed as rewards to community members for their posts or comments in the subreddit and can be freely traded and spent in the community for various purposes. USDC is the world's second-largest dollar-pegged stablecoin, with over $27 billion in market capitalization.
In other words, u/MeLLoN98 used his free MOON tokens to bet on the bitcoin price and won over $91,000. u/MeLLoN98 said he is planning to accumulate more MOON with the amount won.
"Moons are getting on Arbitrum One next month with a partnership with Celer Network, so more liquidity is coming," the trader said, explaining his plans to buy more MOON.
Polymarket has several other betting contracts tied to bitcoin and ether. One, floated in December, allows traders to speculate on whether the BTC price will rise to a record high on Binance on or before March 31. As of writing, shares in the Yes side of the contract traded at 18 cents, representing just an 18% probability of bitcoin climbing above $68,789 by the end of the first quarter.
u/MeLLoN98, which goes by the name RedditMoons-10$ on Polymarket, has purchased more than 230,000 shares of the Yes side of the contract.
"This bet is a lot more crazier. I paid approximately $27k and if it happens I'll get $230k," u/MeLLoN98 said.
