The Anatomy of a Blockchain Prediction Market: Polymarket in the 2024 U.S. Presidential Election

Kwok Ping Tsang and Zichao Yang

Papers from arXiv.org

Abstract: Using the complete on-chain settlement ledger, we study Polymarket's 2024 U.S. presidential election markets, focusing on the Trump YES price widely quoted as a forecast of the race. Because the platform mints and burns outcome shares inside ordinary trades, naive aggregation overstates turnover. We develop a transaction-level decomposition that separates turnover from net inflow and market activity: in October it reports \$391 million of Trump-market turnover against \$958 million of naive volume. Corrected price impact reveals a shallower market: moving the October forecast by five percentage points cost \$9.1 million rather than \$15.6 million. Capital entered on both sides of the race throughout the month, consistent with heterogeneous beliefs rather than one-sided manipulation. The overstatement holds across 249 markets and is largest in thin, young ones.

Date: 2026-03, Revised 2026-09
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://arxiv.org/pdf/2603.03136 Latest version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2603.03136

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().