Polymarket, a blockchain-based prediction market platform, attracted attention with the highest trading volume ever during this election season. Monthly trading volume reached approximately $2.5 billion in October and $1.2 billion in November, with a handful of experienced users making significant profits from Polymarket election bets. However, data shows that most Polymarket users suffered losses, reflecting the risk and volatility inherent in prediction markets.
Platform for betting on current events
Polymarket’s popularity soared in 2024 as users placed bets on a variety of cultural and political questions. From predicting election results to guessing who will be the next James Bond, the platform has become a hub for public speculation. Media outlets have increasingly cited Polymarket as a viable alternative to traditional polls, especially as election night approaches. According to Shayne Coplan, Polymarket’s founder, the platform provided a “real-time reflection” of public sentiment, with Trump consistently leading Polymarket despite some polls tilting toward Harris. Polymarket election betting showed a distinct trend during this period.
The odds are not in favor of most users
According to Polymarket data, despite the platform’s rapid growth, it lost about 89% of its users. Analysis from the Dune Dashboard and LayerHub shows that many users received negative returns, and many of these bettors bet incorrectly or suffered losses. About 237,000, or 371,000 unique accounts lost less than $100, according to LayerHub’s wallet data. In contrast, just over 1% of platform wallets reported profits exceeding $1,000. Therefore, polymarket election betting can be considered a high-risk endeavor for most participants.
Average bet sizes further illustrate this trend. Bets between $100 and $500 made up about 28% of all bets, while bets under $10 made up 18%. This shows that although most bets were not large, many users suffered heavy losses.
High-risk wins and token farming tactics
The story of Polymarket’s small group of “whales” was markedly different. Some accounts, such as popular user “Theo4,” made millions of dollars in profits by betting on Trump’s election success. Theo4 reportedly made $47 million in profits from Polymarket election bets on $45 million in bets, but follow-up research by Chainalytic suggests this figure could be as high as $78.7 million across multiple accounts.
Polymarket’s data also shows a trend of “mass farming” by users speculating on potential token airdrops. This practice involves making repeated trades to increase trading volume, which may result in some losses over time. But for many, these small losses are an acceptable trade-off with the hope of securing future rewards.
Regulatory issues and the future of polymarkets
Polymarket’s success has not gone unnoticed by regulators. France’s National Gaming Authority (ANJ) recently launched an investigation into Polymarket’s operations to determine whether its betting practices comply with French gambling laws. The platform’s structure is designed to prevent it from being classified as a gambling site, but the sheer scale of bets and high-profile wins by the likes of French nation Theo4 have sparked scrutiny. Regulatory issues may impact the future of Polymarket and Polymarket election betting activities.
As regulators around the world consider the legality and ethical implications of prediction markets, Polymarket’s user trends provide insight into the volatile nature of such platforms. The data highlights that while it presents an exciting opportunity for some, there are risks for ordinary users who lack the expertise or luck to win big in this high-stakes environment.