Ethereum co-founder Vitalik Buterin warns that decentralized prediction markets, currently relying heavily on speculative gambling, face long-term collapse without structural reforms. Buterin highlights that these markets over-emphasize short-term betting rather than serving their intended purpose of information discovery and risk management. He proposes evolving prediction markets into insurance-like hedging platforms and envisions a future where personalized AI-driven prediction market shares could replace fiat currency for maintaining purchasing power.

