Polymarket Volume Drops in February, But Active Users Remain Healthy

While Polymarket’s volume has dropped off since the U.S. presidential election, the prediction market did not crater in December and January, buoyed by the Superbowl and sports betting in general.

February does not look so strong, however, with the month on track for a steep dropoff, with just $341 million halfway through the month, according to Dune Analytics.

Compare that with October’s $2.5 billion in volume, November’s $2.6 billion, December’s $1.9 billion and January’s $1.25 billion, and the drop looks steep.

But that doesn’t take into account that last February’s volume was a miniscule $46 million.

Active Users Rise

The picture for active users looks even better, with the numbers growing substantially since November’s election, according to Token Terminal.

In October, there were 142,000 active users. That grew to 303,000 in November, 277,000 in December, 437,000 in January and 419,000 in the first half of February. A year ago, there were just 3,500 active users.

Sports betting is a big part of that growth, with events like the NBA Championships, Super Bowl and UEFA Champions League bringing in traders in big numbers.

Political Change

The spectacular growth of Polymarket up to and since the Presidential election led to clashes with the Commodity Futures Trading Commission (CFTC), which in early January subpoenaed Coinbase, demanding customer records as part of an investigation into Polymarket.

That attitude appears to have disappeared with the change in leadership, as Commissioner Rostin Behnam, who tried and failed to get a Federal court to ban election betting by Polymarket competitor Kalshi, has departed the agency.

“I think election prediction markets are here to stay,” CFTC Commissioner Summer Mersinger said at a Federalist Society panel on Feb. 11. “So the agency has to take a different approach. The idea that we can unilaterally say no by calling everything gaming, those days are over. We have to be a little more pro-innovator and understand that something might look different from what we know or what we are used to, but different isn't bad.”

While Polymarket officially denies it, speculation has been growing that the change to a more crypto and blockchain-friendly administration may cause Polymarket to launch a token of its own, accompanied by an airdrop.