How Polymarket works: USDC, wallets, orders, and resolution
Polymarket runs an order book on Polygon with positions in USDC, plus a separate US-regulated app. How shares, orders, resolution, and withdrawals work on each.
Polymarket is a prediction market whose global site runs on the Polygon blockchain, with every position held in the stablecoin USDC and every share paying $1 when it settles. Since 2025 there has also been a separate, US-regulated Polymarket app, and the first thing to know is which of the two you are looking at.
The mechanics below are stable; the fees, deposit routes, and availability are dated. Check the venue's own page before relying on it.
Two Polymarkets
The global site is the one that built the venue's name: a crypto-native exchange with no fee on most markets, funded in USDC, and closed to US persons since a 2022 settlement with the CFTC. Geoblocking enforces the ban, and the terms of service make it the user's problem if they route around it.
The US app came after Polymarket bought a CFTC-licensed exchange in 2025 and launched a venue for US customers under the same regulatory framework as Kalshi. As of September 2026 it has its own rulebook, its own market list, and dollar accounts with identity verification, and it does not share an order book with the global site. The two carry the same brand and often the same questions, but they are different exchanges. Are prediction markets legal in your state applies to the US app the same way it applies to Kalshi, and Polymarket versus Kalshi lines the three venues up side by side.
The rest of this guide describes the global site unless it says otherwise, because that is where the volume and the mechanics that confuse people live.
USDC and wallets
The global site does not hold dollars. It holds USDC, a stablecoin pegged to the dollar, on Polygon. A new user signs in with an email or a crypto wallet; the email route creates a wallet behind the scenes, the wallet route uses one you already control. Either way your balance is USDC at a wallet address, not a bank ledger entry.
Getting USDC in means sending it from an exchange or another wallet, bridging it from another chain, or buying it with a card through a third-party on-ramp the site links to. The venue covers the Polygon network fee on trades, so you do not pay gas each time you buy or sell. It is a crypto account all the same, and Prediction market taxes covers what that means under the 1099-DA regime.
Shares and orders
A market has YES shares and NO shares, and one of each can always be created by depositing $1 USDC into the market, or redeemed for $1 by combining them. That is why YES and NO always price to about $1 together: if the pair ever sold for more, someone would mint one and sell both. How yes/no contracts work covers the payout logic that follows.
Trading happens on a central limit order book. Orders are signed by your wallet and matched off-chain by the venue, then settled on-chain, which is why a fill can take a few seconds to show. A limit order names a price and rests; a market order takes what is there. The book is visible on every market page, and it is the second thing to read after the rules.
Why the displayed price can be a midpoint
The percentage on a Polymarket market card is, on most markets, the midpoint of the best bid and best ask, not the last trade. On a liquid market the two are the same thing. On a thin one they are not: a card showing 50% can sit on a book of 40 bid, 60 ask, where nobody has traded in days and a buyer pays 60. Our pages print the midpoint too, which is why every price on this site comes with the reminder to look at the book. Price versus probability covers how far to trust a thin number.
Resolution: UMA on the global site, a rulebook on the US venue
The global site does not decide outcomes itself. When a market's event has happened, anyone can propose a result to the UMA optimistic oracle by posting a bond. If nobody disputes the proposal within the challenge window, it stands and the market pays. If someone disputes it, holders of UMA's token vote on the answer, and the losing side of the dispute forfeits its bond. Most markets resolve without a dispute. The ones that get disputed are the ones with ambiguous wording, and a vote can take days.
The US app resolves the way Kalshi does: the exchange's own rulebook names a settlement source, the exchange declares the result under CFTC oversight, and there is no token vote. The same question can therefore have two resolution processes under one brand. How settlement works covers why the rule text, and now the resolution process, is the contract.
A worked example
Say the government shutdown market shows 28% on the card. The book is 27 bid, 29 ask.
| Step | Amount |
|---|---|
| Buy 200 YES shares at the 29 ask | pay 58.00 USDC |
| Fee on this market | 0.00 USDC |
| Shutdown happens, resolves YES | receive 200.00 USDC |
| Profit | 142.00 USDC |
| No shutdown, resolves NO | lose 58.00 USDC |
| Alternative: sell 200 shares into a 45 bid a week later | receive 90.00 USDC, profit 32.00 |
The 28% on the card was never a price anyone could trade. The buy cost 29, an immediate exit would have paid 27, and the two-point gap is the spread. On a market like Bitcoin above $100,000 with a deep book, the gap is a point or less; on a long-dated one like the 2028 presidential market, years before most people are paying attention, it can be five or more.
Withdrawing
Withdrawing from the global site means sending USDC from your Polymarket wallet to another address on Polygon, then moving it to an exchange or bank from there. The venue's interface handles the first step; the second is yours, and it is where most of the friction and any conversion fee lives. How to withdraw from Polymarket walks through it step by step. On the US app, withdrawals go back to a bank account in dollars, the same way they do on Kalshi.
What to check before you trade
- Which Polymarket you are on. The global site and the US app are different exchanges with different rules.
- The resolution source and, on the global site, whether the wording leaves room for a dispute.
- The bid and ask under the displayed midpoint.
- Whether this particular market carries a fee. Most do not; some do.
- How you will get USDC out, before you put it in.
Nothing on this page is investment advice, and the venue's current rule text and fee page are the only things that pay.
Reviewed Thu, Sep 17, 2026. Guides are re-read against the live markets every week; fees, rules, and availability change, and the venue’s own page is the final word.