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 participants who hold different views on an outcome. Market prices continuously shift to reflect participants' aggregate probability assessments — changing instantly as fresh information emerges.
The basics: prediction markets
In a prediction market, you acquire shares corresponding to potential outcomes. Each share has a value of $1 upon YES resolution, or $0 upon NO resolution. When you purchase a YES share for 40 cents ($0.40), you're implying a 40% likelihood of that event materialising. Success means your capital doubles. Failure means your investment evaporates.
Polymarket operates differently from conventional bookmakers in that it charges no built-in margin (the "vig"). Participant supply and demand alone determine the price.
How Polymarket uses blockchain
Polymarket operates atop the Polygon blockchain (a layer-2 scaling solution extending Ethereum). This architecture delivers:
- Complete transparency and on-chain auditability of every transaction
- Automated execution of deposits, exchanges, and distributions via smart contracts
- Elimination of counterparty risk — Polymarket operators cannot seize assets or alter results
- Near-instantaneous finalisation rather than multi-day clearing cycles
USDC: the currency of Polymarket
Polymarket exclusively facilitates trading in USDC (USD Coin), a stablecoin maintaining a 1:1 correspondence with the US dollar. Your account remains insulated from cryptocurrency price swings — each USDC unit consistently equals $1.
How markets resolve
Once an event's outcome becomes established, Polymarket employs the UMA Oracle (Universal Market Access) for market settlement. An appointed "proposer" furnishes the outcome; a 2-hour challenge period follows; absent objections, the distribution executes. Contested determinations escalate to UMA token holders, who render a decentralised verdict.
Getting started on Polymarket
- Create an account — register via email and undergo identity verification
- Deposit USDC — fund via MoonPay, direct bank transfer, or existing digital asset holdings
- Browse markets — explore offerings spanning politics, athletics, blockchain, entertainment and beyond
- Buy shares — select YES or NO and specify your investment amount
- Track and exit — liquidate your holdings whenever you choose prior to outcome determination
PolyGram streamlines this workflow via an intuitive mobile application and passwordless email authentication. Start trading on PolyGram →
Why Polymarket prices are accurate
Empirical evidence consistently demonstrates that prediction markets surpass conventional polling methodologies and specialist commentary in forecast precision. Throughout the 2024 US election campaign, Polymarket's probability calculations demonstrated superior accuracy relative to prominent polling organisations. The mechanism is straightforward: financial incentives compel participants toward rigorous, unbiased evaluation.