Polymarket: A Decentralized Prediction Market for Real-World Events

What is Polymarket

Friends, imagine a place where you can turn your “predictions” into tradable “stocks,” just like trading company shares—that’s what Polymarket does. It’s a blockchain-based prediction market platform. Simply put, it’s like a giant “betting” platform, but instead of gambling, you’re staking your views on future events. For example, who will win the next election? What will a certain economic figure be? What will be the outcome of a sports event? You can “invest” your judgment here.

On this platform, you don’t directly bet “yes” or “no”; instead, you buy “shares” representing a particular outcome. If that outcome happens, your shares become valuable; if not, your shares may go to zero. These shares can be freely traded in the market, with prices fluctuating in real time, reflecting the collective view of the probability of the event happening.

Its target users are anyone with an opinion about future events who wants to test those views through the market. The core scenario is to use collective intelligence to predict the outcomes of real-world events, generating a “market consensus” or “probability forecast.”

The typical user flow is: users first deposit USDC stablecoin (a cryptocurrency pegged to the US dollar, stablecoin: a cryptocurrency designed to maintain price stability, usually by being pegged to fiat currencies like the dollar) onto the platform. Then, they can choose an event market they’re interested in, such as “Will President X be re-elected?” If they think “yes,” they buy “yes” shares; if “no,” they buy “no” shares. The price of these shares changes in real time based on supply and demand. When the event outcome is determined, the market settles, and users holding the correct outcome shares earn profits.

Project Vision and Value Proposition

Polymarket’s vision is to use the power of free markets to “reveal” the truth about the most important real-world events. The core problem it aims to solve is: in an age of information overload, how do we get more accurate and objective predictions about future events? Traditional polls and expert analysis are often biased or lag behind, while prediction markets, by pooling the funds and information of many participants, can form a decentralized, real-time collective intelligence.

Imagine if the wisdom of everyone in the world was pooled to vote on an event, and each person backed their vote with real money—wouldn’t that result be more accurate than a simple poll? Polymarket wants to provide a “decentralized,” more transparent, and more trustworthy source of prediction data in this way.

Compared to similar projects, Polymarket emphasizes its decentralized nature on the Polygon blockchain and uses smart contracts for market settlement, increasing transparency and security. In addition, its recent partnership with X (formerly Twitter) makes it the official prediction market partner of X, greatly expanding its user reach and influence. Recently, Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, invested up to $2 billion in Polymarket, signaling that traditional financial giants see huge potential in “on-chain data” and “information tokenization.”

Technical Features

Polymarket’s technical core lies in its decentralized architecture and application of blockchain technology. It runs on the Polygon Proof-of-Stake (PoS) network. Polygon is an Ethereum sidechain designed to provide faster transaction speeds and lower fees, which is crucial for prediction markets that require frequent trading.

Specifically:

• Smart Contracts: Every market on Polymarket is managed by smart contracts. Smart contracts are computer programs stored on the blockchain that automatically execute when preset conditions are met. This means market creation, share trading, and final settlement are all done automatically and transparently on-chain, without centralized intervention.
• USDC Stablecoin as Collateral: All markets use USDC as collateral. This means users’ funds are stable and not affected by the volatility of cryptocurrency prices, ensuring fairness in the prediction market.
• Tokenized Outcome Shares: When you buy a share of an outcome on Polymarket, you actually receive an ERC-20 token representing that outcome. ERC-20 Token: The most common token standard on Ethereum, defining a set of rules for interoperability within the Ethereum ecosystem. These tokens can be traded or redeemed on-chain like other cryptocurrencies.
• Oracle: Prediction markets need a reliable mechanism to determine real-world event outcomes. Polymarket initially used UMA Optimistic Oracle to resolve market outcomes. Oracle: A service that connects real-world data to blockchain smart contracts. Recently, it has also partnered with Chainlink for markets related to asset prices. There are reports that Polymarket may be considering building its own “truth layer” to resolve markets, reducing reliance on external oracles and potential manipulation risks.
• Tech Stack: From its GitHub repositories, Polymarket uses Solidity (smart contract language), NextJS (frontend framework), IPFS (decentralized storage), web3.js (JavaScript library for blockchain interaction), and more.

Tokenomics

Currently, Polymarket does not issue its own native token for prediction market trading. This means users participate in markets and trade shares directly using USDC stablecoin, not a proprietary Polymarket cryptocurrency.

However, the market strongly anticipates and speculates that Polymarket will issue a native token called “$POLY” in the future. The founder has hinted at the possibility of a future token. Based on current speculation and analysis, if the $POLY token is launched, its tokenomics and use cases may include:

• Token Symbol/Issuance Chain: Expected to be $POLY, likely issued on the Polygon network.
• Token Use Cases:
  • Governance: Holders of $POLY may have voting rights on the platform’s future direction, protocol upgrades, new market listings, etc., enabling decentralized governance: a way to manage and make decisions for blockchain projects through token holder voting.
  • Fee Discounts: Token holders may receive discounts on trading fees on the platform.
  • Liquidity Rewards: To incentivize users to provide liquidity to markets, $POLY tokens may be used as rewards.
  • Data Rights: Given ICE’s investment aims to distribute Polymarket’s on-chain data, $POLY may also be linked to data access or data rights.
• Issuance Mechanism and Total Supply: No official details yet. Some analysis suggests distribution may occur via airdrop to active users and may include staking mechanisms to enhance decentralization and network security.
• Current and Future Circulation: As the token has not been officially issued, there is currently no circulation. The earliest expected launch is Q1 2026.

Note: All information about the $POLY token is based on market speculation and analysis; Polymarket has not released an official token whitepaper or detailed tokenomics. Until official information is published, all of this should be considered non-definitive.

(Note: Search results mention an ERC-20 token called “POLYMRKT” with a total supply of 100 million, but its market value is zero and it appears unrelated to Polymarket’s future token plans.)

Team, Governance, and Funding

Team

Polymarket was founded by Shayne Coplan in 2020, who also serves as CEO. Shayne Coplan has extensive experience in crypto, and his original intention in founding Polymarket was to turn the prediction market concept from whitepaper into reality.

The team includes a Chief Legal Officer, Head of Market Strategy, Head of Data Analytics, Chief Marketing Officer, and more. As of September 2025, Polymarket has about 71 employees across four continents.

Governance

Since Polymarket currently has no native token, its governance structure is likely more centralized, with decisions made by the team. However, with the future launch of $POLY, a decentralized governance mechanism is expected, allowing token holders to participate in key decisions such as platform upgrades and market listings.

Funding

Polymarket has performed well in fundraising, receiving support from many well-known investors. It has raised a total of $2.3 billion.

• Key Funding Rounds:
  • October 2020: $4 million seed round.
  • January 2024: $25 million Series A.
  • May 2024: $45 million Series B.
  • October 7, 2025: Up to $2 billion strategic investment from Intercontinental Exchange (ICE), parent company of the NYSE, bringing Polymarket’s valuation to $9 billion.
• Notable Investors: Includes Polychain, Founders Fund, General Catalyst, Blockchain Coinvestors, ParaFi, and other institutional investors. Ethereum co-founder Vitalik Buterin and renowned VC Peter Thiel are also angel investors.

This massive investment not only provides Polymarket with ample funding, but also signals traditional finance’s recognition and interest in blockchain prediction data and information tokenization.

Roadmap

Polymarket’s roadmap can be seen from its historical milestones and future plans:

Key Historical Milestones and Events:

• 2020: Polymarket platform officially launched, founded by Shayne Coplan.
• January 2022: Fined $1.4 million by the CFTC for not registering as a swap execution facility and ordered to stop serving US users.
• May 2022: Appointed former CFTC Commissioner J. Christopher Giancarlo as Chairman of the Advisory Board.
• May 2024: Announced completion of two funding rounds, raising $70 million, with investors including Vitalik Buterin and Founders Fund.
• 2024 US Election: Became the most active market on the platform, with total bets exceeding $3.3 billion.
• June 6, 2025: Partnered with X (formerly Twitter) to become X’s official prediction market partner and launched an integrated product combining Polymarket’s prediction probabilities with X’s real-time data.
• July 2025: Acquired CFTC-regulated exchange and clearinghouse QCEX for $112 million, paving the way for re-entry into the US market.
• September 2025: CFTC granted QCX a “no-action letter,” exempting it from certain reporting obligations, giving Polymarket the green light for legal US operations.
• October 7, 2025: Received up to $2 billion strategic investment from ICE, parent company of the NYSE, with a valuation of $9 billion.

Future Key Plans and Milestones:

• Reopening to US Users: After acquiring QCEX and receiving CFTC approval, Polymarket has launched a US user waitlist and plans to reopen services to US users soon.
• Tokenization Initiatives: The partnership with ICE will drive future tokenization initiatives, possibly including using on-chain prediction data as the basis for new financial products (such as tokenized indices and event-driven derivatives).
• $POLY Token Launch: The market widely expects Polymarket to launch its native $POLY token in Q1 2026, which is expected to be used for governance, incentives, and user rewards.
• Technical Upgrades: As the Polygon network itself upgrades (e.g., higher TPS and lower finality time), Polymarket’s user experience and trading efficiency will also improve.

Common Risk Reminders

While Polymarket shows great potential, as a blockchain project it also comes with some inherent risks:

Technical and Security Risks:

• Smart Contract Vulnerabilities: Polymarket’s core functions rely on smart contracts. If there are undiscovered vulnerabilities, it could lead to loss of funds or incorrect market settlement. Although the code is audited, risk cannot be completely eliminated.
• Oracle Manipulation Risk: Prediction market outcomes depend on the accuracy of external information sources (oracles). If an oracle is manipulated or provides incorrect data, it could lead to unfair market settlement. While Polymarket uses UMA Optimistic Oracle and Chainlink and may develop its own solution, oracle risk always exists.
• Platform Stability and DDoS Attacks: As an online platform, Polymarket may face cyberattacks (such as DDoS), causing service interruptions or user inaccessibility.

Economic Risks:

• Insufficient Market Liquidity: If some markets have few participants, it may lead to low liquidity, making it hard for users to buy/sell shares at reasonable prices or fully exit when the market closes.
• Risk of Fund Loss: Prediction markets are essentially “bets” on future events. If your prediction is wrong, you may lose all your invested funds.
• USDC Stablecoin Depegging Risk: Polymarket uses USDC as collateral. Although USDC aims for a 1:1 peg to the dollar, in extreme market conditions, stablecoins can briefly depeg, affecting the actual value of user assets.

Compliance and Operational Risks:

• Regulatory Uncertainty: The regulatory environment for prediction markets is still evolving globally, especially in the US. Polymarket was previously fined by the CFTC and banned from serving US users. Although it is now re-entering the US market via QCEX, future regulatory changes may still impact its operations.
• Legal Compliance: Prediction markets may be considered gambling or unregistered financial products in some jurisdictions, leading to legal challenges and operational restrictions.
• Token Issuance Risk: If $POLY is issued in the future, its issuance method, distribution, and regulatory compliance are all uncertain. Improper token issuance may face legal risks or market acceptance issues.
• User Education and Risk Awareness: Users without a technical background need to learn how prediction markets work and their risks. Insufficient risk awareness may lead to irrational investment behavior.

Not Investment Advice: Please remember, all information above is for reference and educational purposes only and does not constitute investment advice. Participation in any crypto project or prediction market is high risk; please make decisions cautiously after fully understanding the risks and conducting independent research.

Verification Checklist

To help friends better understand and verify the Polymarket project, here are some public information sources you can consult:

• Block Explorer Contract Address: Polymarket runs on the Polygon PoS network. You can use PolygonScan (Polygon’s block explorer: a tool that allows users to view all transactions, blocks, addresses, and token information on the blockchain) to check its related smart contracts and transaction activity. While there isn’t a single “Polymarket main contract,” its market settlement, tokenized shares, etc., all involve on-chain contracts.
• GitHub Activity: Polymarket maintains multiple code repositories on GitHub, including Solidity smart contracts, client libraries, and more. By checking its GitHub page, you can assess the project’s development activity, code quality, and community contributions.
• Official Documentation: Polymarket provides official technical documentation, including details on its CLOB (Central Limit Order Book), CTF (Conditional Token Framework), and real-time data streams.
• Official Website: Visit Polymarket’s official website (polymarket.com) for the latest market information, announcements, and platform features.
• News and Announcements: Follow mainstream crypto and traditional financial media coverage of Polymarket, especially its partnerships with ICE, X, and regulatory developments.
• Social Media: Follow Polymarket’s official accounts on X (Twitter) and other social media for real-time updates and community interaction.

Project Summary

Polymarket is a blockchain-based prediction market platform that allows users to express and trade their views on events by buying and selling “shares” representing future outcomes. It runs on the Polygon PoS network, uses smart contracts for transparent and automated market creation, trading, and settlement, and uses USDC stablecoin as collateral. Its core value lies in aggregating collective intelligence to provide real-time, decentralized predictions for real-world events (politics, sports, economics, etc.).

Polymarket has made significant progress in recent years, especially its partnership with X and the $2 billion investment from ICE, the parent company of the NYSE. This not only brings strong financial backing but also signals huge potential in traditional finance and data sectors. These partnerships show that Polymarket’s on-chain prediction data is seen as a valuable “source of truth” and a foundation for future financial products.

Although Polymarket currently has no native token, the market widely expects it to launch a governance token called “$POLY” in Q1 2026, which may grant holders governance rights, fee discounts, and liquidity rewards.

However, Polymarket also faces technical risks (such as smart contract vulnerabilities, oracle manipulation), economic risks (such as insufficient liquidity, fund loss), and compliance and operational risks (such as regulatory uncertainty, token issuance risk). It was previously fined by the CFTC for regulatory issues, but by acquiring regulated entity QCEX, it is actively seeking legal operation in the US market.

Overall, Polymarket is an innovative and promising project that aims to change how we access and trade information through blockchain technology. It elevates “prediction” from mere guessing to a tradable asset and may become an important part of future data and financial markets. But like all emerging technologies, it comes with uncertainty and risk.

For more details, please do your own research, and remember, the above does not constitute investment advice.