Gate Institute: Polymarket accelerates growth, Gate explores new entry points for prediction markets

Null Summary

• Polymarket’s trading volume and active users are generally moving upward in sync, indicating the platform is not solely reliant on a few large accounts to amplify data, but retention remains clearly influenced by hot topic cycles.

• The rise in fees and revenue is driven both by trading demand and by the gradual expansion of fee coverage and changes in fee structures since Q1 2026.

• Platform trading is highly concentrated in a few high-interest sectors such as politics, sports, and geopolitics, while long-tail categories currently cannot independently support overall liquidity.

• Polymarket exhibits attributes of both information markets and sentiment markets, but currently functions more like an event trading arena activated during high-attention windows.

• Gate’s prediction products are not simply a weakened on-chain version of the same concept, but address different issues related to account integration, access friction, user conversion, and product distribution.

Introduction

As of April 2026, Polymarket’s trading volume and fees are at all-time highs. The platform has evolved from an early on-chain experiment into an event market capable of handling large-scale trading flows in politics, sports, macroeconomics, and geopolitical events.

The core of this article is not to reiterate what prediction markets are, but to answer four more specific questions: First, is Polymarket’s growth truly structural? Second, is the expansion of fees and revenue demand-driven or rule-driven? Third, what are users actually trading? Fourth, why are leading exchanges like Gate beginning to incorporate prediction products into their trading systems?

Based on these questions, this article will re-analyze Polymarket’s prediction market through data, comparisons, explanations, and judgments.

Trading and Active Users

Polymarket’s trading volume shows a clear stepwise upward trend. In April 2024, monthly trading volume was only $38.9 million; by May, it rose to $59.2 million; by October 2024, it surged to $2.28 billion, further reaching $2.58B in November. Although December dipped to $1.7 billion, it remained well above mid-year levels. Entering Q4 2025, the platform accelerated again, with monthly trading volume from October 2025 to March 2026 rising from $4.1 billion to $10.57 billion. In scale alone, Polymarket is no longer just an experimental on-chain product but has formed an event trading market comparable to some mature trading venues.

Polymarket’s growth curve results from the combined effects of event-driven demand and the platform’s capacity to absorb it. The sharp increase from October to November 2024 closely correlates with election-related trading; the new wave of volume growth from Q4 2025 to Q1 2026 is driven by sports, macro, finance, and geopolitical topics. The platform has shifted from “riding a single big event to viral fame” to “multiple high-interest themes taking turns.”

Active user growth is synchronized with trading volume. In July 2024, the platform had only 41.3k monthly active traders; by November 2024, this increased to 293.7k; in January 2025, it reached 462.6k. After a mid-2025 dip, active traders rebounded to 477.9k in October 2025, with recent monthly active figures reaching 764.7k. This indicates that Polymarket’s trading volume growth is accompanied by a continuously expanding user base. However, active user data also clearly shows strong cyclical patterns: during hot topic declines, retention drops, suggesting that although the user base is thickening, loyalty and daily necessity are not yet strong enough to fully offset event cycles.

Overall, Polymarket’s growth is relatively genuine, but its authenticity is closer to a structural expansion driven by event shocks. It has proven capable of absorbing traffic during major information windows and converting it into trades, but it cannot yet sustain the same steep growth rate in the absence of strong narratives.

Fees and Revenue, Cautiously Interpreting High Income

Compared to trading volume, Polymarket’s fee data requires cautious interpretation. First, the fee structure itself has undergone policy changes. According to official fee documentation, Polymarket employs a dynamic fee model that charges only takers, with different rates for different categories; currently, geopolitical and world events still have zero fees. This means that fee growth is not solely demand-driven but also directly influenced by the expansion of fee coverage and adjustments in fee rates. Annualizing the fee curve can easily misread rule changes as permanent operational improvements.

Key fee jumps occurred around late March 2026. Verified data shows that in Q1 2026, gross protocol revenue was $16.23 million; by early April 2026, fees over the past 30 days reached $14.75 million, with $10.36 million in the past 30 days. After expanding fee coverage on March 30, the first full week’s fees reached $6.8 million, and on April 1, daily fees once exceeded $1 million.

The recent 30-day fee scale approaches the revenue of a full previous quarter. This indicates strong trading demand, but more importantly, it reflects that a large volume of previously non-fee-paying event trading has been incorporated into monetization, causing revenue to leap. This should not be simply interpreted as demand doubling overnight.

Therefore, current high fees are driven both by demand and by rule changes. Demand is evidenced by the platform’s large trading flow, while rule-driven growth is reflected in the “monetization switch” being gradually turned on. From an operational perspective, these are distinct. Relying solely on daily fees exceeding $41.3k to annualize hundreds of millions in revenue can be misleading, as two realities must be considered: first, high fee rates may suppress high-frequency trading and market making; second, the most attention-grabbing geopolitical markets remain zero-fee, meaning the platform’s hottest liquidity pools may not translate proportionally into protocol revenue.

Thus, the fee curve truly demonstrates that the platform has proven it can charge, indicating a viable business model; but whether high revenue can be sustainably replicated still requires longer-term observation of trading structures, market maker subsidies, fee elasticity, and user reactions.

Market Structure and Event Concentration

Polymarket is far from a uniformly dispersed broad-spectrum market. Politics, sports, and geopolitics alone account for 92% of total trading volume. When including smaller categories like culture, economy, crypto, weather, and finance, it’s clear that long-tail markets exist but contribute minimally to overall trading.

The core demand of Polymarket does not come from a universal “anything can be priced” approach, but from a few high-interest, high-controversy, high-frequency information sectors. Users prefer trading events with strong media propagation and clear outcome points. The reason politics, sports, and geopolitics dominate long-term is because these themes combine narrative strength, informational increment, and clear settlement. Moreover, although the platform appears open, it functions more like a collection of top-tier event markets. As long as leading topics continue to emerge, liquidity concentrates; without enough high-quality event supply, long-tail markets cannot sustain overall volume.

This structure also introduces risks. Highly concentrated markets tend to generate depth and price discovery efficiency during hot events, but are more dependent on supply. Polymarket has room to expand categories, but current trading still heavily relies on a few thematic pools. Its sustainability depends not only on user growth but also on the platform’s ability to continuously list new, tradable, and settleable high-interest events.

Trading Behavior and Time Distribution

From a product intuition, prediction markets are often described as “information markets,” because prices compress dispersed information into probabilities. But on Polymarket, this definition only partially applies.

On one hand, weekends do not mean the platform is quiet. In January 2026, a Sunday saw over $814 million in total trading volume, with Polymarket accounting for about $127 million; during the geopolitical conflict trading window in March 2026, Polymarket, along with other 24-hour crypto platforms, facilitated risk expression during traditional market closures. On the other hand, weekend liquidity is also thin, and there are cases in January 2026 where traders exploited weak weekend liquidity to impact short-term price markets. This indicates that weekend trading on Polymarket can be unbalanced—“sharp amplification during events, deep thinness when no events occur.”

A more accurate assessment is that Polymarket exhibits both information market and sentiment market attributes, but the sentiment amplification feature is still very prominent at this stage. It can quickly compress news, opinions, public sentiment, and odds into trading prices—an information market trait; but its high dependence on hot events, dissemination rhythm, and collective narratives means it is not a purely rational information aggregator. In other words, Polymarket’s price discovery is mainly activated in high-attention scenarios.

Polymarket’s Sector Positioning

Polymarket is often compared to variants of DEX, sports betting, and perpetual contracts, but it is not identical to any of these.

It differs from DEX because its trading objects are not general assets but conditional outcomes of discrete events; it is different from traditional betting because on-chain positions can freely transfer before settlement, with prices reflecting continuous probability changes; it is unlike perpetual contracts because its core is not directional leverage or funding rates, but limited-term probability trading around specific events.

A more fitting positioning is to see Polymarket as an “event derivatives market” or “information trading market” within crypto. It transforms macro, political, sports, and public opinion events—traditionally hard to standardize—into tradable, orderable, and cancellable binary or multi-outcome contracts. It does not replace spot or futures but offers a new tradable object: the future state of the world itself. Because of this, it is especially attractive during macro turning points, election cycles, major sports events, and geopolitical conflicts, where expectations naturally diverge and can be expressed via “probability prices.”

This is also Polymarket’s unique role in the crypto ecosystem. It does not primarily serve asset allocation but focuses on information expression, attention monetization, and event risk pricing. As long as this function persists, it cannot be simply classified as a regular trading platform; but its heavy reliance on event flows makes it unlikely to develop into a stable, low-volatility, high-retention long-term product like mainstream spot or perpetual markets.

Gate Prediction Market Product Observation

Gate’s entry exemplifies prediction markets’ integration into trading platform product expansion. According to Gate’s official announcement, Gate has integrated a Polymarket portal into its app, offering “prediction mode” and “trading mode” interactions, supporting USDT trading within the exchange account, and allowing USDC participation via Web3 wallets on Polygon. The key is transforming the original process—requiring wallets, networks, stablecoins, and on-chain interaction—into an account-based experience closer to spot trading.

Centralized platforms are not simply creating weaker on-chain copies but solving a different set of problems. First, custody and account systems: Polymarket’s native path emphasizes self-custody and on-chain settlement, which is open, transparent, and composable; Gate’s approach consolidates funds, positions, orders, and settlement within exchange accounts, reducing learning curve. Second, access friction: for existing exchange users, entering prediction markets with USDT and existing accounts is smoother than preparing a Polygon wallet and USDC separately. Third, liquidity organization: on-chain markets excel at open matching and external market maker access, but centralized platforms are better at migrating existing user flows, order books, chart tools, and trading habits into new products, shortening cold start.

However, the advantages of on-chain versus centralized are asymmetric. Polymarket’s strengths include verifiable on-chain positions, higher market openness, easier access for external developers and market makers, and a product closer to native information trading. Gate’s strengths lie in lower educational costs, easier account switching, and higher user conversion efficiency, making it more suitable for onboarding existing spot and derivatives users into event trading. Regulatory boundaries differ as well: on-chain platforms emphasize open infrastructure and global liquidity, while centralized platforms focus on regional and account-based product visibility and access.

Thus, the significance of Gate’s prediction market product should be understood as a divergence into two different product paths. Polymarket emphasizes on-chain openness and native information trading; Gate emphasizes low-friction access, account integration, and existing user conversion. Both will coexist long-term, serving different user segments and regulatory environments.

Risks, Constraints, and Future Evolution

External constraints faced by Polymarket primarily involve regulation. In November 2024, French regulators pushed for geoblocking in France; by April 2026, the CFTC publicly sued three states to uphold federal jurisdiction over prediction markets. These developments show that the classification of prediction markets—whether as derivatives, gambling, or information tools—remains unsettled across regions. As the platform penetrates more into mainstream finance, this classification will directly impact accessible users, listed events, and settlement frameworks.

Internal structural risks cannot be ignored. First, oracle and adjudication risks: although Polymarket uses clear rules and UMA’s Optimistic Oracle, complex events, ambiguous language, and boundary conditions may cause disputes, and increased disputes reduce user trust in a low-friction tool. Second, liquidity concentration risk: current trading heavily depends on top events; if popular topics diminish, the long-tail depth issues re-emerge. Third, fee instability: recent proof of fee-collecting ability also reveals sensitivity to rule adjustments; excessive fees or insufficient subsidies could dampen market making and high-frequency trading. Fourth, user retention uncertainty: many users come for specific events like elections, wars, or tournaments but may not stay once hot topics fade.

The key to future evolution is whether the platform can transform episodic peaks into more stable trading habits. This requires solving three issues simultaneously: improving market creation and settlement quality, expanding non-explosive sustainable themes, and balancing fee structures, market making, and user experience. Only then can Polymarket evolve from a high-heat application into a more durable product category.

Conclusion: The Current True Value and Boundaries of Polymarket

Undeniably, Polymarket has proven three things. First, it is not a fleeting on-chain experiment but a real event trading platform with actual trading volume, user growth, and revenue. Second, its growth is not purely hype; active users and trading volume are genuinely synchronized, indicating the platform is not solely relying on a few whales to inflate data. Third, it has established a clear and scarce position in crypto: turning future events into tradable objects.

But it has yet to prove three other things. First, high growth does not mean demand has become de-evented; the platform remains heavily driven by politics, sports, and geopolitics. Second, rapid fee increases do not automatically guarantee stable annual revenue, as fee expansion itself is a significant variable. Third, it has not yet demonstrated that it can become a universal, low-volatility, high-retention long-term product; currently, it remains a highly efficient market device within high-information-density windows.

Therefore, Polymarket’s true value lies in transforming a previously hard-to-trade class of objects into a genuinely liquid market and demonstrating commercialization potential. Its boundary is that this market still heavily depends on event supply, regulatory environment, and user attention. Looking ahead, both on-chain native paths and Gate-style centralized integrations are likely to coexist: the former as an open information trading infrastructure, the latter as a lower-friction product distribution channel. The real focus for ongoing observation is who can first turn prediction markets from a high-peak hot product into a normalized trading category.