In this guide
Key takeaway: Polymarket is a decentralised prediction market where participants trade YES/NO shares on real-world events using USDC on the Polygon blockchain. Settlement occurs automatically via smart contracts.
How does Polymarket work? Fundamentally, Polymarket functions as a prediction marketplace: rather than wagering against a traditional bookmaker's spread, you exchange positions with other participants who hold opposing views. The market price continuously reflects the aggregate probability assessment of the community — adjusting instantly as fresh information emerges.
The basics: prediction markets
In a prediction market, you acquire shares representing potential outcomes. Each share is redeemable for $1 upon a YES resolution, or $0 upon a NO resolution. Purchasing a YES share at $0.40 signals your conviction that the event has a 40% likelihood of occurring. Success doubles your capital; failure forfeits your initial investment.
Polymarket differs from conventional bookmakers by eliminating the built-in margin (the "vig"). Price discovery happens exclusively 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 transparency and on-chain auditability of all activity
- Automated execution of deposits, trading, and settlement via smart contracts
- Elimination of counterparty risk — the Polymarket operator cannot seize assets or alter resolution outcomes
- Near-instantaneous settlement rather than multi-day clearing cycles
USDC: the currency of Polymarket
Polymarket exclusively settles trades in USDC (USD Coin), a stablecoin maintaining a 1:1 peg to the US dollar. Your trading balance remains insulated from crypto price swings — each USDC unit 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 reports the result; a 2-hour challenge period follows; absent objection, settlement becomes binding. Should a dispute arise, UMA token holders adjudicate through decentralised governance.
Getting started on Polymarket
- Create an account — register via email and complete identity verification requirements
- Deposit USDC — fund your account through MoonPay, direct bank transfer, or transfer from your existing crypto wallet
- Browse markets — explore offerings across politics, athletics, digital assets, 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 market conclusion
PolyGram streamlines this workflow through a mobile-optimised platform and email-based authentication. Start trading on PolyGram →
Why Polymarket prices are accurate
Prediction markets have repeatedly demonstrated superior forecasting performance relative to conventional polling and specialist commentary. Throughout the 2024 US election season, Polymarket's probability assessments surpassed the accuracy of leading polling indices. The mechanism is straightforward: financial exposure compels participants toward rigorous, unbiased evaluation.