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(AsiaGameHub) –   While the prediction platform Polymarket suggests its products utilize collective intelligence to forecast future events, the majority of its users encounter a different outcome. New analysis by Andrey Sergeenkov indicates that most Polymarket traders experience financial losses. Out of an estimated 2.5 million participants, only 15.9% managed to achieve profitability, with the remaining 84.1% incurring losses.

The Data Reveals Some Interesting Patterns

This disparity becomes more pronounced at higher earning levels. Approximately 2% of users earned over $1,000 in total. Traders who surpassed the $10,000 mark represent less than one percent of the user base, and only about 840 users achieved six-figure earnings. Contrary to the platform’s association with viral success narratives, the broader reality mirrors traditional speculative markets, where a small fraction of participants reaps the majority of the gains.

According to the study, the timing of participation is a significant factor. Polymarket saw a substantial increase in users during the 2024 US election cycle, drawing in a large number of new participants. However, many of these individuals possessed limited experience with prediction markets or trading in general. Sergeenkov’s research found that trading performance tends to decrease as user participation grows.

Consistency also presents a challenge. While some users may achieve strong monthly returns, very few can maintain a winning streak. Just over 1% of traders earn more than $1,000 per month. Those consistently making over $5,000 are even rarer, and sustaining this level over multiple months is exceptionally difficult. The data indicates that over half of profitable traders reached their highest earnings in a single month, with many departing the platform shortly thereafter.

Very Few Successful Users Stay Active for Long

The study suggests that the actual user experience seldom aligns with Polymarket’s public perception. Social media often features accounts of effortless profits and traders accumulating substantial sums quickly. While these instances occur, they are statistically infrequent. A very small percentage of users who averaged over $5,000 per month remained active for more than a year. The typical pattern involves brief periods of activity rather than sustained income generation.

The inherent structure of prediction markets can help explain these outcomes. Prices reflect collective sentiment, meaning traders often operate against the consensus. Identifying an advantage in such an environment can be difficult, particularly in prominent markets where information is widely disseminated. Furthermore, the continuous influx of new users may further exacerbate the disparity between experienced traders and novices.

Most new traders lose money. It would be helpful if influencers promoting the platform at least taught their audience the basics: bankroll management, how prediction markets work, and why betting on impulse is a fast way to lose everything.

Andrey Sergeenkov

Concerns regarding market integrity have also gained prominence. The platform has faced scrutiny over suspected insider trading, particularly in political markets. To address these issues, Polymarket has strengthened its regulations, prohibiting trades based on non-public or improperly acquired information and limiting the involvement of individuals who could influence market outcomes.