Vitalik Buterin: 3 reasons for Pro-Trump market forecasts

Buterin wonders whether the crypto-forecasts are really true, or whether they only stem from the lack of liquidity and political opinion.

Most polls point to a very likely victory for Joe Biden, although this is not reflected in the crypto-forecast markets.

For Ethereum co-founder Vitalik Buterin, this „big difference“ is something of a mystery. He has made three assumptions as to why such a disparity has arisen.

Buterin suspects that these markets „correctly take into account the possibility of greater electoral manipulation, voter suppression, etc. that could affect the outcome“. In contrast, statistical models would perhaps „simply assume that the electoral process is fair“.

To verify this, Buterin asked Nate Silver to understand how statistical models explain the effects of both „regular“ electoral irregularities, such as voter repression and the rule of law, and „irregular“ irregularities that Trump mentioned in his comments on the election.

Silver is a statistician and the founder and editor-in-chief of the political news site FiveThirtyEight. In 2016, FiveThirtyEight gave Trump significantly higher odds of winning the election than the other pollsters, experts and traditional betting markets. By the editorial deadline of Bitcoin Supersplit Review, Silver had not responded to Buterin’s enquiry.

Buterin’s second assumption was that the prediction markets were still too illiquid to be really accurate. Buterin also addressed the presumed political attitude of the participants in the prediction markets:

But Buterin’s third conjecture, which he considers unlikely, was that pollsters and other technocrats and analysts are „incorrigibly stupid and simply haven’t learned their lessons and surprising pro-trump voters cannot discover how it happened in 2016“. That, according to Buterin, „is something I simply find unlikely“.

Together with his partner Glen Weyl, Buterin has long developed an alternative, collective decision-making process called the square vote. This is supposed to be fairer than the existing systems.

FiveThirtyEight predicts a 10 percent chance for Trump’s victory. The list of „odd and not so odd possibilities“ largely explains the uncertainties of the American electoral system and the different ways in which the weighting of citizens‘ votes is distorted.