Interpreting Polymarket's Major Updates Last Night: Fee Expansion, Self-Regulation, and New Incentives
- Core Viewpoint: Prediction market platform Polymarket recently implemented a series of significant updates, with the core focus on transforming the platform from a "high-risk gambling arena" into infrastructure emphasizing transparency and information pricing. This is achieved by strengthening compliance oversight, adjusting the fee structure, and launching incentive programs, aiming to gain regulatory trust and pave the way for long-term development.
- Key Elements:
- The platform updated its market integrity rules, explicitly prohibiting trading based on non-public information, establishing positions based on illegal information, and participation by entities with the ability to influence event outcomes. This is accompanied by monitoring and reporting mechanisms.
- Announced a fee adjustment effective March 30, 2026, introducing charges for new market categories such as finance and politics. The fee rate is dynamically calculated, peaking when the price approaches 50%.
- Fully opened the referral program. Users with trading volume exceeding $10,000 can receive a 30% direct referral and 10% secondary referral fee rebate. Rewards are uncapped and distributed daily.
- Launched a market maker rebate program, redistributing a portion of taker fees daily to liquidity-providing market makers. The rebate ratio varies by market (e.g., as high as 50% for finance).
- This update did not involve token airdrops, but community feedback is generally positive. Users view the referral program as a long-term income channel, willingness to participate in market making has increased, while arbitrage trading opportunities may be compressed.
Original | Odaily (@OdailyChina)
Author | Asher (@Asher_ 0210)
Last Saturday, Mustafa, a member of the Polymarket official team, posted on X, indicating that major news would be announced this Monday.
Activity from a Polymarket official team member last weekend
As expected, the official Polymarket account has released multiple significant updates since last night. Next, Odaily will break them down for you one by one.
Updated Market Integrity Rules to Combat Insider Trading and Manipulation
Last night, Polymarket announced updates to its market integrity rules for both its DeFi platform and its CFTC-regulated U.S. exchange, further clarifying regulatory requirements regarding insider trading and market manipulation. Neal Kumar, Chief Legal Officer of Polymarket, stated: "Markets thrive on transparency. These refined rules make our expectations clear for all participants on both platforms and highlight our established compliance infrastructure. As Polymarket continues to grow, we will keep building on this foundation, ensuring our markets fulfill their ultimate purpose—revealing the truth—through clear communication with our users."
The new rules specify three categories of prohibited conduct, including:
- Trading on Material Non-Public Information: A participant must not trade any contract if they possess confidential information about the outcome or likely outcome of the underlying event, and using that information would breach a pre-existing duty of trust or confidentiality owed to another person or entity.
- Building Positions Based on Illegally Sourced Information: A participant must not trade based on confidential information provided by another person if that information was provided by someone who owed a pre-existing duty of trust or confidentiality to another, and the participant knows or has reason to know that the person providing the information would themselves be prohibited from trading on it.
- Trading by Entities with the Ability to Influence Event Outcomes: A participant must not trade any contract if they possess sufficient authority or influence to affect the outcome of the underlying event.
Simultaneously, the platform explicitly prohibits behaviors such as wash trading, matched orders, and price manipulation, and has launched a dedicated page to explain the rules and provide channels for reporting suspicious activity. Furthermore, Polymarket stated that its DeFi platform identifies risks through on-chain transparency mechanisms and a multi-layered monitoring system, while its U.S. platform combines technical surveillance with collaboration from industry regulators to investigate and penalize violations.
This round of rule updates essentially redefines Polymarket's market boundaries: what information can be traded and what behaviors are explicitly excluded. By addressing insider information, information sources, and the ability to influence outcomes, the platform has turned previously ambiguous gray areas into clear "no-go" red lines. It has also introduced supporting monitoring and reporting mechanisms, bringing trading behavior into a more traceable framework.
More importantly, this points to a shift in the platform's positioning. Polymarket is moving from an external perception as a "high-risk gambling arena" towards emphasizing its role as market infrastructure for information pricing and transparency. By proactively strengthening compliance and rule articulation, it aims to gain trust from regulators and the public, laying the groundwork for broader future expansion.
The Era of "Big Fees" Arrives: Fees for All Markets Except Geopolitical Events
According to Polymarket's latest official documentation, the platform will adjust its fee mechanism starting March 30, 2026. In addition to the existing Crypto and Sports categories, new market categories such as Finance, Politics, Economics, Culture, and Weather will be included in the taker fee scope.
The new fee rates are calculated using a dynamic formula directly related to price intervals. Overall, the new fee structure presents a "high in the middle, low at the ends" distribution: the effective fee rate peaks when prices are near a 50% probability, while it significantly decreases in extreme intervals close to 0% or 100%, potentially rounding down to 0 for very small trades.
Under the current fee system, the peak effective rate for Crypto markets is about 1.56%, and for Sports about 0.44%. In the upcoming new fee structure, differences between categories widen further. For example, Crypto peaks around 1.80%, Finance and Politics around 1.00%, and Economics can reach 1.50%. Concurrently, maker rebate ratios for each category have been set, with Finance as high as 50%, and most other categories around 25%.
The fee calculation is based on a unified formula that dynamically factors in trade size, price, and different market parameters. Fees are denominated in USDC but are charged as "shares" for buy orders and deducted in USDC for sell orders.
New fee standards for various markets
Not News About Fundraising or Token Airdrops, But an Open Referral Program
This morning, Polymarket announced on X that its referral program has expanded from internal testing to all traders with a trading volume exceeding $10,000. Eligible users can receive rewards proportional to the trading volume of the new users they refer. Specific invitation details are as follows:
- 30% fee rebate from direct referrals, and 10% fee rebate from secondary referrals (rewards will be valid for the first 180 days after a user registers with Polymarket, subject to change without notice);
- Fee rebate rewards are distributed once daily (UTC);
- Rewards are uncapped; the more the referred users trade on the platform, the more earnings the referrer receives.
Polymarket invitation interface
Launch of Maker Rebate Program
In addition to opening the referral program, to incentivize consistent and competitive quoting and thereby provide a better trading experience for all traders, Polymarket has launched a maker rebate program. Specifically, this mechanism redistributes a portion of taker fees back to liquidity-providing makers, effectively redistributing trading costs among market participants.
Rebates are settled and distributed daily in USDC. Only successfully placed orders that are executed participate in the distribution. The overall earnings are not a fixed value but are calculated based on the proportion of liquidity contributed in actual executed trades. More executions and higher contributions lead to correspondingly higher rebates.
In terms of distribution logic, the system calculates a "fee equivalent value" for each executed trade, factoring in trade size, price, and fee parameters for different markets, and aggregates this within the same market. Final rebates are allocated according to each maker's contribution share. This means competition exists not only in whether a quote gets filled but also in the price range of the quote and the fee contribution it generates. Overall, these rebates come from fees paid by takers, with varying rebate percentages across markets—for example, 20% for Crypto, up to 50% for Finance, and around 25% for most other categories.
Rebate percentages for various markets
No Token Airdrop Information Yet, But Overall Community Sentiment Remains Optimistic
Although the community previously anticipated that the "major news" might point to a token or airdrop, what ultimately materialized was a combination of fee, rebate, and referral system updates. From the outcome, this mechanism leans more towards long-term incentive design rather than a one-time expectation release. However, sentiment has not cooled; instead, with clear, actionable paths now available, the overall feedback from the trading community has been positive.
Many users are treating the referral program as a "de facto airdrop entry point," especially KOLs with existing traffic or community resources, who have noticeably increased their sharing efforts—some even treating it as a long-term income stream. Following the launch of the maker rebate program, feedback from the LP side has been direct, with more people reassessing their market-making strategies and showing significantly increased willingness to participate.
In contrast, arbitrage traders and those chasing closing prices are more measured. With the new fee rules, some previously viable arbitrage opportunities will be compressed, requiring strategies to be recalculated. Trading rhythms are consequently becoming more收敛 (convergent), relying more on precise execution and cost control.
However, with Polymarket and Kalshi now under regulatory scrutiny, their valuations in the coming period will likely be weighed down by policy uncertainties. (Related news: US lawmakers to propose bipartisan bill banning sports predictions on prediction markets like Polymarket)
