Polymarket Dominates the Prediction Market, Capturing 99.7% of the Volume Share

In the decentralized finance (DeFi) sector, prediction markets have become even more noteworthy, providing a means for users to wager on the results of all sorts of real-world events.

Polymarket is the clear leader in this area, claiming an astonishing 99.7 percent of the total volume processed by prediction markets. According to the latest report from Token Terminal, which tracks market conditions and emerging opportunities across the crypto space, Polymarket’s overall volume appears to have stabilized since the post-election drop-off.

A Stronghold in Prediction Markets

The prediction market sector, taken as a whole, has a Total Value Locked (TVL) of $141 million. In the aftermath of the much-awaited US election, market activity took a small dip, but it has now stabilized in a range between $130 million and $140 million over the last 30 days. That said, Polymarket remains unchallenged in its position, with a market share that amounts to more than $113 million of the total TVL, making up over 80% of the entire sector.

Other platforms in the space, like Azuro, which has a TVL of 5.36 million (about 4% of the total), and doubleUp/Gnosis Protocol V, and Lumi Finance, are the other main actors in the prediction market. However, these platforms are not nearly as massive as Polymarket, in either user engagement or transaction volume.

Polymarket vs. Azuro: A Comparison of Dominance

Polymarket stands unsurpassed in the world of prediction markets. It has a total volume of 10.8 billion dollars that it has generated from the activity of its users. By contrast, its closest rival, a prediction market known as Azuro, has accumulated only 295 million dollars in volume. Polymarket’s total volume figure is, thus, 40 times greater than that of Azuro.

In terms of sheer volume, the difference is huge. Polymarket’s $35.4 million in volume dwarfs Azuro’s $7.81 million by a factor of 4.5, and we should remember that the $7.81 million was a projected May figure, likely inflated relative to typical amounts. If we take these numbers at face value (which is what you have to do unless you have reasons to doubt them), then Polymarket isn’t just far ahead of Azuro in terms of bettor count and engagement; it also crushes Azuro in terms of volume.

Both the volume and the level of user participation speak to Polymarket as the dominant platform. On it, a wide array of events—and even more—betting opportunities, appear to be newer and higher-stakes. In fact, its top three categories could almost serve as a lead-in to a news broadcast. They focus on very major global events: the Presidential Election, the NBA, and the Super Bowl. The only kind of event that has us more on the edge of our seats is a kind of event we just had last week: a presidential signing. This focus on sports is literally icing on the cake.

The Importance of Prediction Markets

What are prediction markets? More than just a speculative tool for crypto traders, they are an almost miraculous way of producing liquidity, a.k.a. the “effective market hypothesis” of real-world events. Moreover, as Vitalik Buterin, co-founder of Ethereum, points out, prediction markets could impact a range of fields, from social media and science to journalism and governance, by serving as an unorthodox but possibly very effective way of collecting and processing information that could powerfully alter decisions across those industries.

Blockchain technology is continuously evolving. The crypto market’s rapidly growing capitalisation seems to have no bounds. Against this backdrop, prediction markets are playing an increasingly prominent role in the modern world. Polymarket is one such platform. The outcomes of significant events are what its users are betting on. Fairness and security are guaranteed by the platform’s transparent decentralisation. Users pulling the platform’s odds ensure the platform’s privacy.

These markets hold the potential to change our perception of info finance. By this, I mean the practice of making financial decisions based on what we think will happen in the future, not just what has happened in the past. When we make predictions about events that fall into the realm of human behavior (like political outcomes or public sentiment), we don’t have much in the way of reliable signals to work with—other than the signals that the markets themselves might emit. The sector is nascent and has seen only a few attempts in earnest, but one can imagine its maturing into something that has an influence when making predictions about everything from stock prices to the ways in which global economies manage risk and uncertainty.

The Road Ahead for Prediction Markets

More capital is flowing to the blockchain, and decentralized platforms are gaining a lot of mainstream attention. As these two things happen, the prediction market sector seems likely to grow. OKX Ventures, a big player in the blockchain space, continues to support and track innovative projects within the prediction market sector. They have an ongoing commitment to fostering growth within this space.

Currently, Polymarket stands strong at prediction market’s peak, its appearance there unaccompanied by any previous incarnation of Polymarket’s sector. Hence, its impressive numbers and platform’s strength must be interpreted as signals that decentralized, transparent prediction markets are in broad demand. But as we heard Monday, the sector’s not done evolving; competitors like Azuro, Gnosis Protocol, and Lumi Finance are innovating in this space. So let’s end with a question: How will Polymarket adapt to lifetime standing as the sector’s top dog? And can any platform other than Polymarket right now catch up to the appearance of strength that serves as its impressive lead?

We can conclude that the growing importance of prediction markets within the cryptocurrency and blockchain ecosystem has been highlighted by Polymarket’s rise to prominence. Polymarket has not only risen to lead the prediction market space but is also making moves to help define the sector overall. It is hard to see how, in a digital age when all but the most basic pieces of information can be crunched by computer algorithms, using a kind of digital marketplace, the act of making a bet on what will happen next, can’t help but transform various industries, from betting to journalism.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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