Prediction Markets Miss: Lula Wins Brazilian Presidential Runoff, EWZ Perpetual Contract on Hyperliquid Plunges Over 22%

on October 26, according to Cryptonews, Brazilian President Lula defeated Flavio Bolsonaro, son of former President Jair Bolsonaro, in the presidential runoff, becoming the first president in Brazil to secure a fourth term after trailing in the initial round. Prior to the election, prediction market Polymarket briefly assigned an 80% win probability to Flavio Bolsonaro, but as voting results came in, market expectations rapidly reversed.

In markets, following the announcement of Lula's victory, perpetual contracts linked to the iShares MSCI Brazil ETF (EWZ) on Hyperliquid fell by over 22%. Previously, some investors anticipated that a Bolsonaro win would spur fiscal reforms in Brazil and lift the domestic market. Lula's continued tenure implies that his current economic policies and efforts to deepen cooperation with BRICS countries are likely to persist.