In this guide
Key takeaway: Polymarket is a decentralised prediction market where users trade YES/NO shares on real-world events using USDC on the Polygon blockchain. All settlements occur automatically through smart contracts.
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 other participants who hold opposing views. The market price continuously adjusts to reflect participants' collective probability assessments — shifting instantly as fresh information emerges.
The basics: prediction markets
In a prediction market, you acquire shares representing possible outcomes. Each share is worth $1 upon a YES resolution, or $0 upon a NO resolution. When you purchase a YES share for 40 cents ($0.40), you're expressing a 40% probability that the event will occur. Should your prediction prove correct, your investment doubles. Should it prove incorrect, you forfeit your capital.
Polymarket differs from conventional bookmakers by eliminating the house edge (the "vig"). Market prices emerge purely from the interplay of supply and demand across the trader base.
How Polymarket uses blockchain
Polymarket operates atop the Polygon blockchain (a layer-2 scaling solution for Ethereum). This architecture delivers:
- Complete transparency and on-chain verifiability of every transaction
- Automated execution of deposits, trading activity, and settlement via smart contracts
- Elimination of counterparty risk — Polymarket staff cannot seize assets or alter settlement outcomes
- Near-instantaneous resolution, measured in minutes rather than business days
USDC: the currency of Polymarket
Polymarket exclusively uses USDC (USD Coin), a stablecoin maintaining a fixed 1:1 peg against the US dollar. Your trading account remains insulated from cryptocurrency price fluctuations — each USDC unit consistently equals $1.
How markets resolve
Once an event's outcome becomes established, Polymarket employs the UMA Oracle (Universal Market Access) to finalise market settlements. An appointed "proposer" reports the outcome; a 2-hour challenge period follows; absent objections, settlement becomes binding. Markets facing disputes proceed to a decentralised vote among UMA token holders — functioning as the system's arbitration layer.
Getting started on Polymarket
- Create an account — register via email and satisfy KYC requirements
- Deposit USDC — transfer funds through MoonPay, direct bank deposit, or an existing cryptocurrency account
- Browse markets — explore offerings across politics, sports, crypto, entertainment and additional categories
- Buy shares — select YES or NO and specify your investment amount
- Track and exit — liquidate your holdings whenever you choose prior to market settlement
PolyGram streamlines this workflow through a mobile-optimised platform and passwordless email authentication. Start trading on PolyGram →
Why Polymarket prices are accurate
Prediction markets have repeatedly demonstrated superior forecasting performance relative to conventional polling methodologies and professional analyst predictions. Throughout the 2024 US election period, Polymarket's probability assessments surpassed the accuracy of leading polling organisations. The mechanism driving this precision: financial stakes compel participants to form rigorous, unbiased judgements.