Chainfeeds Summary:
Polymarket is a decentralized prediction market platform that fills the gap in real-time event data in traditional news and social media by providing quantitative probability forecasts. Animoca Digital Research analyzed Polymarket's trading volume and participant numbers, and believes that Polymarket's new users are likely to continue using the platform after the US election cycle.
Source:
https://www.chaincatcher.com/article/2151044
Author:
Animoca Digital Research
Perspective:
Animoca Digital Research: As a platform that sits between gambling and futures trading, Polymarket faces unique regulatory challenges. These challenges peaked in October 2021 when the US Commodity Futures Trading Commission (CFTC) investigated the platform for providing unlicensed futures trading services in its early rapid growth phase. In January 2022, Polymarket reached a settlement with the CFTC, agreeing to pay a $1.4 million fine for offering binary options trading without a futures trading license. As part of compliance efforts, Polymarket subsequently restructured its operations as an offshore platform, barring US residents from participating in its markets. The company also hired former CFTC Commissioner J. Christopher Giancarlo as an advisor to help navigate the complex regulatory issues and ensure future compliance. A year after the CFTC settlement, Polymarket launched its 2024 US Presidential Election Winner market in January 2024, quickly sparking a surge in trading activity. As the year progressed, major political events - including a failed assassination attempt on Trump and Biden's surprise withdrawal - further fueled intense interest in election forecasting. By the final month of the election, with early voting results trickling in, Polymarket's popularity reached an all-time high. Throughout the 2024 election cycle, Polymarket's monthly trading volume skyrocketed, growing from a few million dollars in January to $50 million in January, $400 million in July, and easily surpassing $1 billion by October. The total open interest - the USDC locked up and the potential payout if all contracts settled - grew from $7 million on January 1, 2024 to around $400 million by November 1. This locked capital exceeded TRON's total TVL, making Polymarket the 18th largest blockchain infrastructure ecosystem by locked collateral.
Source
