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 other market participants who hold opposing views. The market price continuously adjusts to reflect participants' collective probability assessment — shifting instantly as fresh information emerges.
The basics: prediction markets
In a prediction market, you acquire shares representing potential outcomes. Each share yields $1 upon YES resolution, or $0 upon NO resolution. Purchasing a YES share at 40 cents ($0.40) signals your belief in a 40% probability of that outcome occurring. Correct predictions yield a profit; incorrect ones result in loss of capital.
Polymarket differs from conventional bookmakers by eliminating the vigorish (the house edge). Pricing emerges purely through the interplay of buyer and seller activity.
How Polymarket uses blockchain
Polymarket operates atop the Polygon blockchain (an Ethereum layer-2 scaling solution). This architecture delivers:
- Complete on-chain transparency and auditability of all activity
- Automated execution of account management, order matching, and fund distribution via smart contracts
- Elimination of counterparty risk — the Polymarket organisation cannot seize assets or alter settlement outcomes
- Rapid settlement completion within minutes rather than extended processing periods
USDC: the currency of Polymarket
Trading exclusively occurs in USDC (USD Coin), a stablecoin maintaining a 1:1 peg with the US dollar. Your account balance remains insulated from cryptocurrency price swings — one USDC consistently equals one dollar.
How markets resolve
Upon determination of an event's outcome, Polymarket leverages the UMA Oracle (Universal Market Access) for market settlement. An appointed proposer announces the result; a 2-hour challenge period follows; absent objections, settlement becomes binding. When disputes arise, UMA token holders participate in decentralised adjudication.
Getting started on Polymarket
- Create an account — register via email and satisfy identity verification requirements
- Deposit USDC — transfer funds through MoonPay, direct bank deposit, or existing cryptocurrency holdings
- Browse markets — explore categories spanning politics, athletics, blockchain, entertainment and beyond
- Buy shares — select YES or NO and specify your investment amount
- Track and exit — liquidate holdings whenever desired prior to market conclusion
PolyGram streamlines this workflow through a mobile-optimised design and passwordless authentication. Start trading on PolyGram →
Why Polymarket prices are accurate
Prediction markets consistently surpass traditional polling methodologies and specialist commentary in forecast precision. Throughout the 2024 US election cycle, Polymarket's probability assessments demonstrated superior accuracy relative to leading polling organisations. The mechanism driving this performance: financial incentives compel participants to form rigorous, unbiased judgements.