Polymarket has had a remarkable year, with its cumulative trading volume surpassing $1 billion. This surge in activity has been accompanied by a significant increase in weekly active users, which have grown over 14 times.
A Fruitful Year for Crypto
The crypto-space has seen a flurry of activity, with Bitcoin and Ethereum Spot ETFs gaining approval and political leaders from both sides of the aisle showing support for cryptocurrencies. Amidst this backdrop, Polymarket, a decentralized predictions platform, has thrived.
Betting on Real-World Events
Polymarket allows users to buy or sell shares using cryptocurrencies to bet on real-world events. Over the past six months, the platform has seen a surge in usage, particularly with the U.S. election cycle heating up. This increased interest has driven Polymarket’s cumulative trading volume to over $1 billion, with July alone accounting for $387 million.
User Growth and Market Activity
The platform’s monthly active traders jumped from 29.4k in June to 44.5k in July, while Open Interest soared to $90 million. Weekly active users also saw a dramatic increase, growing from around 1,400 to over 20,000.
Election Cycle Influence
Many analysts attribute this surge in activity to the ongoing U.S. election cycle. Bets on who will become the next U.S. President make up over 45% of Polymarket’s total trading volume. However, this isn’t the whole story.
Diverse Market Interests
According to ParaFi Capital, the largest investor in Polymarket, only 42% of the nearly 70,000 addresses that have used the platform made their first trade in an election-related market. The remaining 58%, or around 40,000 users, initially traded in non-election markets, including culture, business, science, and macro events. Furthermore, 56% of users who made their first bet in an election-related market subsequently traded in different markets.
Broader Market Trends
While election-related markets have seen significant volumes, other real-world events have also driven activity. For instance, the SEC’s approval timeline for a Spot Ethereum ETF spurred a $13 million increase in cumulative volume. Other popular markets include bets on Olympic medal tallies, Taylor Swift’s engagement stats, and the potential launch date of GPT-5.
Future Prospects
Polymarket’s recent successes have prompted its executives to explore new strategies, particularly those targeting monetization. One idea under consideration is adding fees to the platform.
In summary, while the U.S. election cycle has certainly contributed to Polymarket’s growth, a diverse range of real-world events has also played a significant role in driving the platform’s popularity and utility.
