Learn · season 05 · episode 13
market.resolve
Polymarket: prices, shares and resolution
A prediction market trades claims on a future result. Follow the claim from its written rules to its price, then to the payout that can finally be redeemed.
This lesson covers Polymarket International. Polymarket US is a separate platform. The four experiments use fictional data in your browser, with no accounts, live orders or real funds.
Assumptions throughout: 1 pUSD = $1. Network and conversion costs and changes in collateral value are omitted. Shares are whole numbers; cash and fees use millionths of pUSD. Each experiment starts independently.
01 · read the question
“Announced” and “available” are different events
A short title cannot carry every rule. Before interpreting a price, identify exactly what a Yes share is a claim on.
Will the public demo be publicly available by 17:00 UTC on 20 October 2026?
- Evidence source
- The invented “Demo Status Archive”, whose dated entries record when the public access page opens.
- Qualifying event
- Anyone can open and use the demo without an invitation. A press announcement, waitlist or private preview does not qualify.
- Deadline and result
- Public access at or before 17:00 UTC qualifies as Yes. A complete archive establishing first access after that deadline supports No. Missing or conflicting evidence requires review.
02 · follow a complete set
A pair is backed by one unit of collateral
Splitting 1 pUSD creates one Yes share and one No share. Merging a matched pair reverses that operation. After resolution, each share redeems according to its recorded payout: normally 1 for the winning outcome and 0 for the other.
Current documentation describes pUSD as Polygon collateral backed by USDC. These names are distinct. CTF and Protocol V2 position systems coexist; this experiment teaches the shared economics, not a universal contract implementation.
One collateral unit, two possible outcomes
The two shares form one complete set. Together they redeem for 1 pUSD, because their payouts add to 1.
pUSD
30.00
Yes shares
0
No shares
0
Splitting needs enough cash. Merging needs the same number of Yes and No shares.
This control skips the oracle workflow for accounting practice. Follow each resolution step in the final experiment.
Start with 30 pUSD. Split 20, then change the quantity to 7 and merge.
| Action | Cash | Yes | No |
|---|---|---|---|
| Start | 30.00 | 0 | 0 |
03 · read the price
60% on screen does not offer you a 60-cent share
A bid is a buyer’s offer; an ask is a seller’s offer. With a $0.58 bid and a $0.62 ask, the midpoint is $0.60. An immediate small purchase takes the ask, while a sale takes the bid, if enough shares are available.
A price can be read as a market-implied probability. It is shaped by participants and available liquidity; it is not an independently measured chance or a guarantee. None of these experiments draws a random outcome from the displayed percentage.
04 · walk the book
The first price only covers the first shares
An order book lists discrete offers. Buy more than the cheapest offer contains and the next shares may cost more. Try buying 25 shares, then lower the cap to $0.63. Finally request 70 shares to reach the end of the book.
The price depends on the side and size
Best bid · sell
$0.58
Best ask · buy
$0.62
Last trade
$0.57
Display · midpoint
60%
Display convention checked 13 October 2026: midpoint for a spread up to $0.10; last trade above $0.10. Missing book inputs show unavailable here.
| Side / price | Available | Buy fills |
|---|---|---|
| Bid 0.58 | 10 | — |
| Ask 0.62 | 10 | 10 |
| Ask 0.65 | 20 | 15 |
| Ask 0.70 | 30 | 0 |
Policy: fill what is available at or below your cap; cancel the rest. Bars preview a fresh copy of this fictional book. There is no persistent trading account.
Order preview: 25 filled; 0 unfilled
- Shares cost
- 15.95 pUSD
- Average fill price
- $0.638
- Fees
- 0.00 pUSD
- Total cash required
- 15.95 pUSD
A resting limit order would leave shares waiting in the book. This experiment cancels them instead. It omits complementary Yes/No matching and assumes sufficient cash for each simulated order.
Polymarket’s central limit order book matches orders offchain and settles trades onchain. Compare this with Uniswap v2’s pool curve: the available liquidity is represented differently.
05 · account for the result
The cash returned is not the profit
Buying 20 shares at $0.60 costs $12 before fees. Selling them at $0.70 returns $14, so the profit is $2. Holding until a Yes payout returns $20 instead; a No payout returns nothing. These are alternative paths for the same shares.
20 Yes shares, bought at $0.60 each
Compare separate possible exits for the same purchase. You cannot sell these shares and then redeem them too.
Assume your sale takes available bids for all 20 shares at the sale price. A displayed quote alone does not guarantee that depth.
Entry cost including fees
12.00 pUSD
12.00 for shares + 0.00 entry fee
Profit: +2.00 pUSD
Profit: +8.00 pUSD
Profit: -12.00 pUSD
Profit: -2.00 pUSD
Each bar shows net proceeds on the same 0–20 pUSD scale. The white line marks the entry cost. Profit is proceeds minus that cost.
| Exit | Exit fee | Received | Profit |
|---|---|---|---|
| Sell before resolution | 0.00 | 14.00 | +2.00 |
| Yes pays 1 | 0.00 | 20.00 | +8.00 |
| Yes pays 0 | 0.00 | 0.00 | -12.00 |
| Exceptional 0.5 payout | 0.00 | 10.00 | -2.00 |
Fee per fill = shares × coefficient × price × (1 − price). Here 0.05 is fictional, not a universal live fee. Fees round to the nearest micro-pUSD for each fill. Redemption has no trading fee in this model.
A 0.5 payout is an exceptional recorded result, not a routine third outcome or a refund of your purchase price. A marked value (shares × quote) remains hypothetical until a sale or redemption realises it.
Source: Polymarket’s price-dependent fee formula. Live rates vary. The fee documentation expresses amounts in USDC; this simulator books their dollar-equivalent value in pUSD under its stated parity assumption.
06 · resolve the market
Evidence must become a recorded payout
Observing an event and holding a redeemable result are separate steps. Use the final experiment to follow an unchallenged proposal, then reset and challenge both rounds. Try the incomplete evidence packets too.
From evidence to a redeemable result
A manual UMA illustration. Each click advances a fictional process; it promises no real completion time or bond amount. Start with 20 Yes shares and no cash.
Changing evidence starts a fresh simulation.
The invented status archive records public access at 16:45 UTC, before the deadline. This supports Yes.
- 1. Evidence
- 2. Proposal
- 3. Challenge interval
- 4. Dispute / vote if needed
- 5. Recorded payout
- 6. Redemption
Examine evidence
No recorded payout. Redemption remains unavailable.
Yes shares remaining
20
Cash received
0.00 pUSD
Resolution record (1 steps)
- Evidence selected; no payout is recorded.
The resolution documentation distinguishes UMA markets from Chainlink TWAP up-down markets. This lab illustrates UMA; the Chainlink lesson explains how external observations become onchain data.
Sources checked 13 October 2026. These fictional experiments omit multi-outcome conversions, incentives and contract-specific integration details.