Polymarket Data Shows 70% of Traders Experience Losses

A year-end analysis of decentralized prediction markets highlights the challenges faced by retail participants on Polymarket. According to DefiOasis, roughly 70% of the platform’s 1.73 million unique trading addresses have recorded negative realized returns, illustrating the zero-sum nature of prediction markets.

The report reveals extreme profit concentration among a small elite. Only 0.0385% of trading addresses account for over 70% of total profits—approximately $3.7 billion—while nearly 25% of profitable addresses earn less than $1,000. Analysts note that sophisticated strategies, including microstructure arbitrage and information-based trading, are key drivers for the top earners.

Retail participants account for the bulk of losses. Over 1.1 million addresses realized losses, typically under $1,000, suggesting many treat the platform as social engagement rather than disciplined trading. Despite this, institutional confidence remains strong: Intercontinental Exchange recently invested $2 billion in Polymarket, valuing the company at $9 billion.

Experts say the data underscores both the predictive power of the platform and the difficulty for average users to profit consistently.