In January, Polymarket processed roughly 4 million euros in wagers on the Portuguese presidential election within the hours earlier than outcomes had been introduced. Inside forty-eight hours, the nation’s playing regulator ordered the platform to wind down its operations in Portugal. Hungary’s regulator blocked the area fully the identical week. By the tip of the month, Polymarket had been progressively banned, restricted, or threatened with enforcement motion throughout greater than a dozen European jurisdictions, together with Germany, France, Belgium, the Netherlands, and Switzerland.
The sample has turn out to be acquainted. A prediction-market platform reaches sufficient quantity to draw consideration. Nationwide regulators classify it as unlicensed playing. Entry is blocked, typically with fines threatened. The platform geofences and strikes on. Regulators in Paris, Berlin, Lisbon, and Amsterdam have all reached variations of the identical conclusion: contracts that pay customers based mostly on the end result of real-world occasions appear to be playing, no matter how the platform describes itself.
In opposition to that backdrop, a New York-based startup referred to as SafeBets has launched what stands out as the most architecturally uncommon entrant the prediction-markets sector has seen. SafeBets customers predict the long run pricing of broadly traded belongings—Bitcoin, gold, oil, shares of main firms—however they accomplish that with out placing any cash in danger. They can’t lose. The solely factor they will earn is a cryptocurrency referred to as Unicoin, awarded to high performers on the platform’s discretion.
That structural distinction—no person wagers, no contractual payouts, no monetary publicity—might end up to matter greater than its founders are publicly emphasizing. In jurisdiction after jurisdiction throughout Europe and Asia, regulators have banned opponents exactly on grounds that, by SafeBets’s personal account, don’t apply to its mannequin. If that argument holds, SafeBets stands to inherit by default the markets its rivals are being expelled from.
How It Works
The mechanics are simple. Customers join at SafeBets.world, full id verification, and obtain 100 unicoins as a beginning steadiness. They use these unicoins to make predictions on the long run pricing of most traded objects: Bitcoin, gold, oil, shares of main firms. If a prediction is correct, the person accumulates extra unicoins. Whether it is improper, the person merely loses one unicoin from their beginning allotment of free unicoins.
Critically, no person ever deposits cash. The unicoins got to them. They can’t be bought on the platform. Customers don’t purchase in, don’t stake capital, and haven’t any contractual proper to any particular end result.
The unicoins themselves are items of Unicoin, the community token underlying the SafeBets platform. Konanykhin describes Unicoin because the Good Coin for Good Folks—a cryptocurrency designed to be mined not by way of brute-force computation, within the method of Bitcoin, however by way of what the corporate calls proof-of-intelligence. In observe, which means unicoins are awarded to customers who persistently make correct predictions, with the algorithm functioning as a filter that surfaces and rewards real forecasting ability. The financial logic is supposed to be self-reinforcing: higher predictors earn extra unicoins, the platform’s aggregated sign improves, and the worth of the underlying community token grows in line with the standard of the neighborhood utilizing it.
The place does the cash behind the prizes come from? SafeBets aggregates the predictions of its highest-ranked customers—recognized by way of what the corporate calls a Filtration Pyramid that ranks predictors by historic accuracy—and makes use of the ensuing collective sign to tell its personal buying and selling in actual monetary markets. When the platform’s buying and selling is worthwhile, half of the earnings are paid out to high predictors as unicoin awards. The unicoins are convertible to money by way of the broader Unicoin market.
Alex Konanykhin, SafeBets’s CEO, describes the mannequin in plain phrases. The platform is constructed to harness what economists have lengthy referred to as the knowledge of crowds, with the extra refinement that not all crowds are equal. Most platform customers can be improper more often than not. A small minority can be reliably correct. The firm’s algorithm is designed to seek out the second group and hearken to them.
“Our customers danger nothing. The platform takes the chance, makes the revenue, and shares it with the individuals whose insights generated the commerce.”
That final sentence can also be the corporate’s regulatory argument.
Why Regulators Might Not Have Grounds to Ban It
Polymarket and Kalshi, the 2 largest prediction-market operators, have spent the previous two years arguing in courtrooms and regulatory hearings that their merchandise are monetary markets slightly than playing venues. The argument has succeeded on the U.S. federal stage—the Commodity Futures Buying and selling Fee accredited Polymarket’s return to the USA in late 2025, and Kalshi operates as a CFTC-regulated Designated Contract Market—nevertheless it has fared poorly virtually in all places else. State gaming regulators in Nevada, Tennessee, and Massachusetts have taken enforcement motion in opposition to numerous operators. European regulators have been extra uniform: France’s ANJ, Germany’s GGL, the Netherlands’ KSA, Portugal’s SRIJ, and Switzerland’s Gespa have all categorised prediction-market exercise as unlicensed playing.
In each a kind of rulings, the operative authorized component has been the identical: customers wager cash on unsure outcomes. That is what playing regulation in most jurisdictions really prohibits. Strip out the wager, and the authorized hook regulators have been utilizing disappears.
That is the structural distinction SafeBets is constructed round. The place Polymarket says “this can be a monetary trade, not playing,” SafeBets says, in impact, “that is neither, as a result of there isn’t a enforceable contract and no person cash in danger.” Customers place no wagers, signal no monetary contracts, and haven’t any proper to any particular payout. Prizes are discretionary. The firm’s personal buying and selling exercise—performed by itself account in actual markets—is regulated individually underneath no matter guidelines apply to proprietary buying and selling wherever it happens.
The sensible consequence is critical. In every of the dozen-plus European jurisdictions the place Polymarket has been blocked, the regulator’s said rationale was unlicensed playing. Whether or not SafeBets’s no-wager structure will survive scrutiny in those self same jurisdictions is an open query—no European regulator has but dominated on a discretionary-prize prediction platform with no person wagers, as a result of no important platform has beforehand provided one. However the authorized grounds which were used to expel SafeBets’s opponents don’t, on their face, attain a mannequin the place customers danger nothing.
That creates a genuinely uncommon aggressive place. As Polymarket and Kalshi face progressive exclusion from European, Asian, and Latin American markets, SafeBets is working in those self same markets with out having attracted comparable regulatory motion. If the architectural argument holds—and it has not but been examined adversarially—SafeBets might discover itself the one significant prediction-market choice accessible to customers in jurisdictions the place the established gamers have been ordered out. Profitable by default will not be the identical as profitable, however in a sector the place buyer acquisition prices and regulatory friction dominate the economics, the distinction will be onerous to see from the skin.
Wulf Hambach, a German lawyer specializing in playing and monetary regulation, has argued that there could also be regulatory house for prediction markets in Europe “if the product is framed in another way—within the path of monetary choices buying and selling, for instance underneath the supervision of BaFin.” SafeBets’s framing goes a step additional, making an attempt to place the user-side product as not requiring monetary devices authorization in any respect. It’s an aggressive posture, however a coherent one, and it’s being examined in a second when regulators have already established what they won’t permit.
Who Pays for the Prizes
The economics of SafeBets rely on the platform’s buying and selling desk being ok at buying and selling to generate earnings adequate to fund the prize pool. That will not be a trivial assumption. Hedge funds with giant analysis budgets, refined quantitative fashions, and a long time of amassed experience typically fail to outperform passive benchmarks. SafeBets is betting that aggregating sign from hundreds of retail predictors, filtered by way of an accuracy-ranking algorithm, can produce buying and selling edge that these funds lack.
The mental lineage right here is actual. Robin Hanson, the economist who popularized the time period prediction market, has been arguing for the reason that Nineties that aggregated forecasts can outperform skilled judgment in particular structured contexts. The Iowa Digital Markets appropriately predicted U.S. presidential election outcomes extra precisely than polling averages for years. Company prediction markets at corporations together with Hewlett-Packard, Google, and Microsoft have proven inner forecasting accuracy positive factors. The empirical case for collective intelligence within reason sturdy.
Whether or not it interprets to constant alpha in liquid public markets, the place each accessible sign is already being mined by well-capitalized professionals, is a unique query. SafeBets’s pitch is actually that retail predictors collectively discover issues that skilled merchants miss—sentiment shifts, narrative adjustments, on-the-ground observations—and that the platform’s algorithm can extract usable sign from that noise.
If that proves true, the prize pool funds itself, and the proof-of-intelligence framing turns into greater than advertising and marketing language: it describes a working system by which forecasting ability is the scarce enter and unicoins are the financial output. If it doesn’t, the discretionary nature of the awards turns into operationally essential: the platform can merely pay out much less in lean intervals. That flexibility is a part of what makes the authorized structure work, nevertheless it additionally raises a query for customers about how dependable the rewards can be over time.
The Wider Context
SafeBets is a part of a broader portfolio operated by TransparentBusiness Inc., a New York firm previously referred to as Unicoin Inc., which can also be planning a public token providing for September. The mother or father firm has a publicly disclosed dispute with the U.S. Securities and Alternate Fee associated to its earlier Unicoin choices, which Konanykhin has characterised as regulatory overreach and which stays unresolved on the time of writing. SafeBets itself has not been the topic of SEC motion.
The platform is purposeful and accepting customers at the moment. Konanykhin’s said ambition is giant—he has publicly instructed that the construction may, over time, assist a Unicoin neighborhood bigger than some other cryptocurrency, together with Bitcoin. Whether or not that ambition is realized is determined by elements nicely past the architectural query, together with person acquisition, the consistency of buying and selling efficiency, and the way regulators in main jurisdictions finally characterize the mannequin.
What’s already true is that SafeBets has put a genuinely totally different proposition into the prediction-markets sector at a second when the dominant gamers are absorbing serial regulatory defeats virtually in all places outdoors the USA. The architectural argument has not but been examined adversarially, and a regulator someplace will finally attempt. However the platform launches right into a panorama by which the authorized grounds used to expel its opponents don’t, on their face, apply to it—and right into a set of jurisdictions by which these opponents are now not accessible to customers in any respect. Whether or not being structurally totally different seems to be sufficient is the query the subsequent eighteen months will reply.
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