Crypto bets on war go mainstream

The following is a visitor publish by Nischal Shetty, co-founder and President at Shardeum.

On 2nd January 2026, an nameless dealer on crypto prediction platform Polymarket put down roughly $30,000 on a contract that Nicolás Maduro could be out of energy by 31 January 2026. Within hours of a U.S. particular forces raid that resulted in Maduro’s seize, that place was value greater than $436,000. Meanwhile, merchants had positioned over $10.5 million on associated bets a couple of U.S. invasion this yr, many tying outcomes to particular deadlines in January, March, and December. Some members staked tens of 1000’s of {dollars} on these geopolitical questions. Polymarket has since refused to settle sure contracts, triggering accusations of arbitrary rule-making and regulatory gaps round occasion definitions in prediction markets.

That episode illustrates a broader shift that got here into focus in 2025. Instruments as soon as confined to fringe corners of crypto buying and selling, like onchain perpetual contracts and crypto-based prediction markets, crossed a threshold from area of interest experiments to high-volume, mainstream infrastructures. Volumes surged. Execution and liquidity matured. Distribution broadened past specialist desks into shopper wallets and messaging apps.

The Polymarket controversy is just not an outlier. Retail participation in derivatives and leveraged products is already high. Appetite for speculative markets is confirmed. Regulatory readability stays unresolved. When geopolitical outcomes and leveraged exposures are tradable with a faucet, customers will have interaction.

The change in 2025 was not in demand. It was in Structure. Infrastructure lastly stopped being the bottleneck.

Infrastructure Stopped Being the Bottleneck

The single most necessary shift in 2025 was architectural.

Leading decentralized perp platforms moved away from shared, general-purpose blockchains towards purpose-built environments. Hyperliquid launched its own custom Layer 1. dYdX migrated from Ethereum to a Cosmos-based appchain. Others adopted related paths.

This allowed platforms to manage execution end-to-end. Latency dropped to sub-second ranges. Gas charges disappeared from the consumer expertise. Order books up to date in actual time. Liquidations grew to become predictable moderately than chaotic.

For leveraged buying and selling, these particulars are decisive. Just a few hundred milliseconds can decide revenue or compelled liquidation. By 2025, decentralized perps largely closed the efficiency hole with centralized venues.

Liquidity Design Mattered More Than Raw Speed

Speed alone didn’t drive adoption. Liquidity engineering did.

Earlier decentralized perpetual platforms relied on skinny order books or exterior market makers. That mannequin failed throughout volatility, when slippage spiked and trades failed. Trust evaporated shortly.

In 2025, platforms redesigned liquidity from first rules.

Some launched inside matching techniques that netted lengthy and quick positions earlier than tapping shared liquidity. Others used LP-backed swimming pools that assured execution at oracle costs, eliminating slippage for many customers. Just a few allowed yield-bearing collateral, reducing the efficient price of leverage.

These modifications improved capital effectivity and consumer outcomes concurrently. Traders received dependable execution. Liquidity suppliers earned steadier returns. Volume became persistent rather than episodic.

Distribution Changed Everything

The most underappreciated shift in 2025 was distribution.

Perpetual futures stopped being one thing customers needed to “go to.” They grew to become options embedded in merchandise customers already used.

Wallets like MetaMask and Phantom built-in perp buying and selling instantly. Telegram emerged as a significant distribution channel by means of buying and selling mini-apps embedded in chats. Aggregators abstracted away venue choice completely.

This collapsed onboarding friction. Users not bridged property, managed fuel, or discovered new interfaces. They traded leverage from the identical place they saved property or communicated.

The end result was a surge in first-time leverage customers. This was not simply extra quantity from professionals. It was a broadening of the consumer base.

For India, that is particularly related. Telegram penetration is high. Wallet adoption is rising. When leverage turns into one faucet away, market participation scales shortly—for higher and for worse.

Asset Expansion Widened the Market

Crypto-only perps capped progress.

In 2025, a number of decentralized platforms expanded into artificial publicity for international trade, commodities, and equities. Traders gained 24/7 entry to international markets with leverage ranges usually unavailable in conventional retail channels.

This unlocked new demand, notably in rising markets the place entry to international derivatives is restricted or costly. It additionally launched sharper regulatory questions round investor safety, disclosures, and danger controls.

From a market-structure perspective, decentralized perps started to resemble a parallel international derivatives layer moderately than a crypto-specific product.

Regulation Lowered Existential Risk

Regulation didn’t trigger this progress. But it lowered the chance of sudden failure.

In the U.S. and different main jurisdictions, clearer frameworks round stablecoins and settlement property lowered uncertainty. Regulators signaled engagement moderately than blanket hostility. Institutions gained sufficient consolation to experiment.

For India, the distinction is stark. Domestic exchanges function underneath heavy restrictions. Offshore platforms appeal to Indian customers with out native oversight.

Ignoring them doesn’t scale back danger. It shifts it elsewhere.

Why 2025 Was the Turning Point

Each of those parts existed earlier than. What modified was their convergence.

Infrastructure matured. Liquidity fashions improved. Distribution went mainstream. Regulatory uncertainty declined. Trading circumstances rewarded lively participation.

Together, they pushed decentralized perps from principle into actuality.

What Comes Next

The dangers are apparent. Embedded leverage will increase the possibility of retail hurt. Product design selections now carry regulatory and reputational penalties. Enforcement gaps can be examined.

Competition will intensify. Speed will not be sufficient. Trust, danger tooling, and consumer safety will differentiate winners.

For policymakers and monetary establishments in India, the lesson is just not that decentralized exchanges will substitute incumbents tomorrow. It is that international market construction innovation is going on exterior conventional rails, at scale.

In 2025, crypto’s most aggressive market grew up. India can not afford to look away.

Disclaimer – this was a promoted (paid) publish as a part of our Thought Leadership program for contributors.

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