In this guide
Key takeaway: Polymarket is a decentralised prediction market where traders buy YES/NO shares on real-world events using USDC on the Polygon blockchain. Smart contracts handle all settlements automatically.
How does Polymarket work? Fundamentally, Polymarket functions as a prediction marketplace: rather than wagering against a bookmaker's built-in edge, you exchange positions with fellow traders who hold opposing views. The market price continuously evolves to reflect participants' aggregate probability assessment — shifting instantly as fresh information emerges.
The basics: prediction markets
Prediction markets enable you to acquire shares representing potential outcomes. Each share yields $1 upon YES resolution, or $0 upon NO resolution. Purchasing a YES share for 40 cents ($0.40) signals your belief that the event has a 40% likelihood of occurring. Victory means your capital doubles; defeat means you forfeit your investment.
Polymarket differs from conventional bookmakers by eliminating the vigorish (the "vig"). Pricing emerges entirely from the interplay of buyer and seller activity.
How Polymarket uses blockchain
Polymarket operates atop the Polygon blockchain (a layer-2 scaling solution for Ethereum). This architecture delivers:
- Complete on-chain transparency and auditability of every transaction
- Automated execution of deposits, trades, and distributions through smart contracts
- Prevention of fund seizure or outcome manipulation by Polymarket operators
- Rapid settlement occurring within minutes rather than extended periods
USDC: the currency of Polymarket
Polymarket trading exclusively employs USDC (USD Coin), a stablecoin maintaining a 1:1 peg with the US dollar. Your trading balance remains insulated from cryptocurrency price swings — each USDC consistently equals $1.
How markets resolve
Upon determination of an event's outcome, Polymarket leverages the UMA Oracle (Universal Market Access) for market settlement. An appointed "proposer" declares the result; a 2-hour challenge period follows; absent objections, the payout becomes binding. Contested resolutions escalate to UMA token holders for decentralised adjudication.
Getting started on Polymarket
- Create an account — register via email and complete identity verification requirements
- Deposit USDC — fund your account through MoonPay, conventional banking, or your existing cryptocurrency holdings
- Browse markets — explore political outcomes, athletic competitions, digital assets, entertainment and beyond
- Buy shares — select YES or NO and specify your amount
- Track and exit — liquidate your holdings whenever you choose before the event concludes
PolyGram streamlines this workflow through a device-optimised platform and passwordless authentication. Start trading on PolyGram →
Why Polymarket prices are accurate
Prediction markets have repeatedly surpassed opinion surveys and specialist predictions in accuracy. Throughout 2024's US election period, Polymarket's probability assessments demonstrated superior precision compared to leading polling organisations. The mechanism: financial incentives compel participants toward rigorous, unbiased forecasting.