How does Polymarket make money? Unlike a sportsbook, Polymarket does not bet against its users. Traders buy and sell shares with each other, and the platform earns revenue mainly from trading fees.
Polymarket's Revenue Model
For much of its history Polymarket charged no trading fees on most markets, funding growth with venture capital. It has since introduced fees on some market categories, generally charged to takers (orders that match immediately), while makers (orders that rest on the order book) may receive rebates [verify before publishing]. The exact fee rate depends on the category and can change — see Polymarket fees.
Why Market Makers Matter
A prediction market only works if there are enough buyers and sellers. Polymarket pays liquidity rewards to traders who keep competitive quotes on the book. This spending is part of the business model: better liquidity attracts more volume, and more volume produces more fee revenue.
Other Sources of Revenue
- US exchange fees: the regulated US app has its own fee schedule [verify before publishing].
- Data and API access: market data is widely used by media and analysts; see Polymarket API and technology.
- Partnerships: media and data partnerships have been announced [verify before publishing].
How Do Prediction Markets Make Money in General?
Most prediction markets earn money from fees on trades, deposits or withdrawals, or from the spread between bid and ask prices. Exchanges that match users against each other (like Polymarket and Kalshi) earn fees; bookmakers earn a margin, sometimes called the overround or vig.
What It Means for You
Because Polymarket doesn't take the other side of your trade, it has no direct interest in whether you win or lose. You still pay costs through fees, spreads and slippage, so always include them in your expected value.