Crypto Trader Nets $233K Windfall Betting Against XRP’s 5% Plunge on Polymarket
A single prediction on a decentralized betting platform just turned into a quarter-million-dollar payday. The wager? That XRP would shed exactly 5% of its value.
The High-Stakes Gamble That Paid Off
Forget traditional analysis—this trader bypassed charts and fundamentals to place a direct bet on the outcome. Polymarket, a platform where users speculate on real-world events, hosted the contract. The target was precise: a 5% drop for the embattled cryptocurrency.
When XRP's price action played out as predicted, the smart contract executed autonomously. No broker calls, no settlement delays. The $233,000 payout was distributed instantly to the winning wallet—a stark contrast to the legacy finance treadmill where profits can take days to 'clear.'
Prediction Markets Meet Crypto Volatility
This case highlights how decentralized prediction markets are converging with the assets they track. Traders aren't just betting on prices; they're using price volatility itself as the underlying asset. It's a meta-layer of speculation that traditional finance still largely sidelines with regulatory skepticism.
The win underscores a cynical truth in modern markets: accurately forecasting a decline can be just as lucrative as believing in the rally—sometimes more so. While permabulls chant 'to the moon,' this trader quietly banked a small fortune on a controlled descent.
Polymarket user counts $200k profit in weekend liquidity crunch
A Polymarket account using the pseudonymous handle @a4385 executed a precisely timed spot trade on Binance to take advantage of the muted price swings on Saturday. Crypto markets mostly have reduced trading volumes and low liquidity outside weekdays.
In a long thread on X by PredictTrader, explaining how the prediction market user snipped $200,000 in profits, a4385 invested in a Polymarket contract asking whether XRP’s price WOULD fall between 12:45 PM ET and 1:00 PM ET on January 17.
The Polymarket user’s counterparties were several automated trading bots, encouraged by solo developers who deployed them to provide liquidity. They place buy and sell orders based on probabilistic pricing models and arbitrage relationships in crypto markets.
When the price of “UP” shares was rising, XRP slipped about 0.3% during the early minutes of the contract, and the automated systems continued selling “UP” shares at high pricing. By the tenth minute of trading, “UP” shares had been pushed to around 70 cents, despite the underlying token moving exclusively in the opposite direction.
The bots’ programming dictated that higher prices should attract more sales, which is exactly what helped the trader take up a dominant position. a4385 had approximately 77,000 “UP” shares with an average acquisition price of 48 cents per share, well below the $1 payout that would apply if the contract settled in favor of an upward move.
XRP was still trading lower. The “UP” shares would have expired worthless without a last-minute reversal. Two minutes before the Polymarket expired, a Binance wallet linked to the trader made a $1 million spot purchase of XRP. This pushing the token’s price up by 0.5%, according to data tracked by PredictTrader.
The Polymarket contract resolved in favor of an upward price change and a redemption at $1 each, which doubled the trader’s average entry cost. a4385 unwound the XRP spot position and sold coins back into the market, causing a slump again.
Data compiled by PolymarketHistory shows the entire operation cost $6,200 after accounting for slippage and execution effects, but the redemption of “UP” shares generated about $233,000 in profit.
“Some bots were shut down in time. Others didn’t react fast enough and lost their entire balances, including @aleksandmoney, which gave up a full year of profits,” PredictTrader wrote on X.
XRP is trading in the red zone
XRP’s price action is still constrained within a narrow range, with its latest high observed NEAR $2.0834, while the most recent low sat around $1.95. At the time of this reporting, XRP was trading at $1.98, just above that lower boundary.
Together with bitcoin and Ethereum, Ripple’s token has a slightly bearish sentiment, in conflict with short-term flashes of an intermittent buying interest. XRP is struggling to sustain a push above the $2.1 resistance level, unless a stronger charge by bulls moves it past $2. Any sustained close below that price mark would help bears scratch away every price momentum down to a downside target of $1.8.
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