Name: "I Just Turned $12 Into $200,000!" – WTF Is Happening To Investing?!
Uploaded: 2026-02-24T21:32:49.000Z
Duration: 17 min 11 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

Heads, you get to double your money, and tails, you lose everything.

Betting everything on a coin flip is obviously insane.

But a growing number of people are doing the financial equivalent of this every single day.

Not because they're dumb, but because playing it safe basically guarantees you fall behind.

This is why more and more young people aren't investing anymore.

In fact, I just read a story about how one trader uses this strategy to pay his rent every month.

Others turn $12 into $100,000 or claim they've cracked a system that Wall street doesn't want you to know about.

So with prediction markets now replacing investing for an entire generation, we need to talk about exactly what's going on.

Why a tiny group is making millions if there's a strategy that actually works, and

how the biggest mistake happens before money even touches the market.

Because once you're able to see this, you.

You'll realize why 94% of people end up losing money.

Although, before we start, in the spirit of this video, I'll make you a deal.

And as a thank you for doing that, here's a picture of a koala.

And also, big thank you to surfshark VPN for sponsoring this video.

All right, so before we talk strategy and why some people lose everything, we need to talk about the gambling loophole.

Legally, there's a very distinct difference between gambling and pretty prediction markets.

And this new classification has opened up a brand new world where people can now invest based on who will win the Oscar for Best Picture if Trump says autism during the State of the Union, or I kid you not, if Juul will relaunch its mint flavor.

Well, unlike gambling, which is a randomized payout structure fixed by the house, prediction markets operate under the premise of offering events based futures contracts, which provides a marketplace for two people to speculate on which event is more likely to occur.

The thinking here is that because the value of the contracts moves with market sentiment, and

there's no fixed house edge, you're not betting against a casino.

You're just trading against people who think that they know more than you do.

And at the end of the day, the entire purpose is to provide a financial hedge in the event a specific outcome actually happens.

For example, let's just say you wash cars for a living and you make no money anytime there's bad weather.

In this case, you could hedge your income by purchasing 2 cent contracts on the slim chance of snow.

That way, if it doesn't snow, your business operates normally and you lose a small investment.

But if it does snow, you get a 50x return which is more than enough to offset your loss of income from washing cars.

Now apply that thinking towards any financial derivative in existence and you have prediction markets that are basically just gambling under the disguise of being event space futures contracts.

Of course, in their defense call she responded by saying that people used to say grain futures were gambling before the Supreme Court approved them and said that they were ultimately needed for a hedging purposes.

But let's be real, most people aren't doing that.

Instead, you have traders that have turned 1,000 into $200,000 in just a few months, there are people you could supposedly follow who have a high success rate, and

others just buy the events with 99% probability to consistently profit.

However, as nice as that sounds, here's the reality.

One report allegedly shows that Kalshi users lose money even faster than sports gamblers, and

once I started digging deeper, I realized that this was just the very beginning.

So if you want to hear something crazy, let's talk about 2026 investing.

Even though it sounds like these platforms should be used as a portfolio hedge, that's not what's happening.

Instead, retail traders are pulling back from the stock market because it feels like a losing game.

So instead of competing in a system that feels impossible to beat, more people are turning to all or nothing bets where it seems more transparent and easy to understand even if the odds aren't in their favor.

For example, surveys found that many young traders would rather bet on things like the Grammy winners or a pot TikTok ban than analyze a PE ratio.

Because at least with the Grammy winners, it's something they understand and comprehend, unlike a financial statement that they were never taught to read.

On top of that, in terms of where they're getting this money, as it turns out, betting dollars largely came from funds previously used for savings and long term investments, and

these numbers were way worse than I expected.

For every $1 a household spent on betting, it put $2 less into investment accounts, with net investments falling by 14%.

Now, the reason for this is pretty simple.

According to a Federal Reserve report, young adults are already a lot less likely to have retirement accounts or really any savings at all.

So with almost nothing to lose, high upside, low probability bets could start to feel rational in a world of perceived scarcity, regardless of how much money they stand to lose.

To give you these exact numbers, 70% of polymarket traders lost money, while only 0.04% captured 70% of the profits.

And even though Kalshi doesn't care whether you win or lose, they do get a small piece of trading volume, which has recently amounted to over a billion dollars in a single day.

This is why one analysis believes that the bottom quarter of Kalshi users lost about 28 cents of every dollar they bet, compared with about 11 cents per dollar on other online gambling sites.

Obviously, Kalsheet responded to this, calling the report extortion and flat out wrong.

But the analyst in question went on record to say that we stand for transparency, we stand for helping betters traders understand their activity across the platform, and

It's evident that when the same phone that holds a brokerage app also has events based contract trading, the mental barrier between investing and gambling pretty much evaporates into thin air.

And when you combine that with the fact that people are losing faith in the traditional investing system, compounding feels too slow and homeownership is out of reach.

High risk bets just start becoming more common.

And that's the thing that almost no one's talking about.

So in terms of which traders are actually making money from this, if there's a system that works, and

how some traders consistently avoid losing money, here's where things get interesting.

Because once you see the data, you'll realize the winners are not who you think they are, and

almost all of these are predetermined before you even place a bet.

However, before we go into that, I find it interesting that some of the biggest risks right now aren't always shown on a chart.

Some of them are invisible, like how much of your online activity is being tracked, sold or exposed, while everyone is distracted by price movements.

That is why I treat privacy the same way as I treat investing.

Minimize the downside, don't overcomplicate it, and automate the boring stuff.

This mindset is exactly why I use our sponsor Surfshark VPN all the time.

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preventing hackers from identifying your city, country and download history or I guess put more simply, a VPN is able to do this by swapping the real location of your device with a new one, giving you the ability to virtually travel anywhere around the world.

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All right, now, before we talk about exactly who's making a fortune from prediction markets and which investors have the highest likelihood of making money, we need to talk about the gamification of investing.

What's really interesting is that a few years ago, Robinhood was facing legal scrutiny for gamifying investing.

And and according to legal filings, as well as interviews with current and former employees, they say that the app was built on what appears to be a Silicon Valley playbook of behavioral nudges and push notifications to draw investors towards risky trading, which happens to make Robinhood a lot of money.

As proof of this, in the first three months of 2020, Robinhood users traded nine times as many shares as E trade customers and 40 times as many shares as Charles Schwab customers.

They also bought and sold 88 times as many options contracts relative to the average account size.

Now, in Robinhood's defense, they were the first brokerage out there to make investing fun.

They got a lot of people interested in investing who otherwise wouldn't have cared, and

they were able to reduce the trading fees down to zero.