Polymarket Accused of Double-Counting its Trading Volume
Paradigm co-founder Matt Huang has amplified analysis alleging that prediction market Polymarket could also be inflating its reported buying and selling volumes by a knowledge aggregation error that causes double-counting throughout most third-party analytics platforms.
The findings, detailed by Paradigm analysis accomplice Storm Slivkoff, counsel the difficulty impacts public datasets and dashboards that depend on Polymarket’s disclosed figures, doubtlessly overstating the platform’s precise exercise by roughly 100%.
The controversy emerged as Huang reshared Slivkoff’s evaluation on X, sparking speedy pushback from Polymarket’s information crew and criticism that Paradigm, an investor in rival platform Kalshi, was making an attempt to discredit a competitor by technical semantics.
Technical Root of Volume Dispute
Slivkoff’s investigation reveals that Polymarket’s good contracts emit separate OrderFilled occasions for the maker and taker sides of every commerce, leading to redundant representations of equivalent transactions.
Most analytics dashboards compute quantity by summing these occasions, successfully counting the identical commerce twice.
A easy transaction involving YES tokens bought for $4.13 generates two OrderFilled occasions for that quantity, inflicting dashboards to report $8.26 in quantity relatively than the precise $4.13 traded.
The complexity stems from Polymarket’s distinctive market construction, which helps eight distinct commerce varieties, together with typical swaps and split-merge operations by which members trade USDC for opposing YES-NO positions.
While no particular person occasion comprises incorrect info, aggregating all OrderFilled occasions with out distinguishing between maker and taker representations ends in systematic double-counting of notional quantity and money move metrics.
The subject extends throughout each Polymarket’s CTF Exchange and NegRisk trade contracts, which share equivalent occasion emission patterns.
Slivkoff’s evaluation, which included constructing a transaction simulator and auditing contract code, demonstrates that correct measurement requires utilizing one-sided metrics, both taker-side or maker-side quantity, relatively than summing redundant occasion streams.
When calculated appropriately, Polymarket’s precise month-to-month volumes for October and November 2024 have been roughly $1.25 billion every, roughly half the $2.5 billion figures displayed on most public dashboards earlier than corrections.
Industry Response and Competitive Tensions
Polymarket’s Primo Data shortly disputed the characterization, insisting that the platform’s official web site shows notional taker quantity with out double-counting, in keeping with business requirements utilized by Kalshi.
“This submit isn’t about Polymarket’s web site, it’s in regards to the frequent dashboards that individuals use for monitoring Polymarket quantity,” Slivkoff clarified, emphasizing the difficulty impacts third-party analytics relatively than Polymarket’s inner reporting.
Major information suppliers, together with DefiLlama, Allium Labs, and Blockworks, confirmed they’re updating their Polymarket dashboards to eradicate double-counting after validating Slivkoff’s findings.
Meanwhile, some analysts defended current practices, with Dragonfly information head Hildobby claiming subtle dashboards accounted for the excellence since 2024, although acknowledging the methodology remained undocumented till now.
The timing drew scrutiny, given Paradigm’s funding in Kalshi, Polymarket’s main US competitor.
Will Sheehan of Parsec Finance criticized the analysis as studying “a bit like successful piece when it’s simply information being laborious and Polymarket’s contracts being open/onchain,” whereas others questioned whether or not the disclosure of Paradigm’s aggressive curiosity adequately addressed potential bias.
Storm defended the work as figuring out sincere errors ensuing from information complexity relatively than assigning blame, noting Polymarket itself bears no accountability for a way third events interpret its occasion streams.
Beyond the speedy quantity dispute, Nick Preszler of Melee Markets argued the controversy highlights broader measurement challenges in prediction markets, the place low-priced contracts can generate disproportionate notional quantity in comparison with precise capital in danger.
“If a person buys $10 value of contracts at .1c every, they’re risking $10, however get credited for $10,000 of quantity,” Preszler famous, advocating for various metrics like open curiosity and payment income to supply extra correct business comparisons.
Polymarket is constructing an inner buying and selling desk to wager towards prospects because it relaunches in U.S. markets following CFTC regulatory clearance.#Polymarket #CFTChttps://t.co/mTAUebkNsV
— Cryptonews.com (@cryptonews) December 5, 2025
The debate comes as Polymarket prepares its full US relaunch following CFTC regulatory clearance and pursues a valuation of $12 billion to $15 billion.
Simultaneously, the corporate is dealing with criticism over plans to establish an internal market-making operation that will commerce towards prospects, mirroring controversial practices already employed by Kalshi.
The submit Polymarket Accused of Double-Counting its Trading Volume appeared first on Cryptonews.
