A new academic study of every Polymarket trade since 2022 found that 68.8% of users lost money, while the top 1% of traders captured 77% of all gains. The top 0.1% alone took home more than half the platform’s total profits.

The working paper from researchers at the University of Toronto, HEC Montréal and ESSEC Business School analyzed 2.4 million users and $67 billion in volume through March 2026.

How The Study Worked

Most studies of retail trading rely on brokerage samples, but because Polymarket settles every trade on the Polygon blockchain, the full population of 588 million trades is publicly visible, wallet by wallet.

The authors rebuilt every user’s running profit and loss from the raw on-chain record, then sense-checked their numbers against Polymarket’s own data API.

They matched perfectly. That gives the paper something rare in retail trading research, complete coverage rather than a slice.

It also exposes how the money moves.

The strongest predictor of profit was not picking the right side, it was posting limit orders rather than taking them.

A one-standard-deviation increase in a wallet’s maker volume share lowered the probability of losing by 9.3 percentage points.

Retail Picks Right And Still Loses

Separate research from University of San Diego professor Joshua Della Vedova found that retail traders actually picked the winning outcome more often than bots, then lost anyway because they paid a worse price. “The execution edge is an underrated aspect of trading,” Della Vedova said.

More than 100,000 Polymarket wallets lost at least $1,000 since January 2025, nearly twice as many as cleared that bar going the other way. The losers dropped $131 million, almost all of which flowed to a small cluster of high-frequency accounts.

The findings land as Robinhood Markets (NASDAQ:HOOD) leans harder into event contracts and Kalshi expands despite a wall of state regulatory fights.

A Citizens analyst note cited by Bloomberg suggested Kalshi users may be losing proportionately more than sports bettors on DraftKings (NASDAQ:DKNG). Kalshi rejected that analysis.

Prediction markets are zero-sum by design, and negative-sum after Polymarket’s new taker fees. The math does not bend in the average trader’s favor.

Polymarket did not immediately respond to a request for comment.

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