Polymarket Data Reveals 70% Trading Loss Rate as Top 0.04% Capture $3.7B in Profits

TLDR:

• 70% of Polymarket’s 1.7 million trading addresses have realized losses according to defioasis data
  
• Less than 0.04% of addresses captured over 70% of total realized profits totaling $3.7 billion
  
• Most profitable traders earned $0-$1,000, representing 24.56% of addresses but only 0.86% of profits
  
• Over 1.1 million addresses realized losses between $0-$1,000, accounting for 63.5% of all traders

Polymarket trading addresses show a concerning pattern of profit concentration, according to recent blockchain analysis. Data from @defioasis reveals that approximately 30% of over 1.7 million trading addresses have realized profits on the platform. 

The remaining 70% of addresses have experienced realized losses. This distribution raises questions about trading outcomes for retail participants on the prediction market platform. 

The analysis examined total sale proceeds, redemption amounts, and purchase costs to calculate realized profit and loss figures.

Profit Concentration Among Top Trading Addresses

The data analysis by defioasis.eth demonstrates extreme profit concentration among a small group of traders. Less than 0.04% of addresses captured over 70% of total realized profits on Polymarket. 

These top-performing addresses collectively earned approximately $3.7 billion in realized gains. Meanwhile, the vast majority of profitable traders earned modest amounts between $0 and $1,000.

This profit range represents 24.56% of all trading addresses but accounts for only 0.86% of total realized profits. 

The disparity between participation rates and profit capture illustrates the challenging nature of prediction market trading. 

According to the analysis shared by @defioasis, earning more than $1,000 in realized profits places traders in the top 4.9%.

The calculation methodology focuses on realized profit and loss rather than paper gains. This approach provides a clearer picture of actual trading outcomes. 

However, the method does not account for unrealized positions, which may affect addresses holding open positions.

Loss Patterns and Trading Outcomes for Retail Participants

The loss side of the equation shows similar concentration patterns among Polymarket users. Over 1.1 million addresses, representing 63.5% of all participants, realized losses between $0 and $1,000. 

This range suggests many traders experienced relatively small losses before exiting positions or reducing activity.

More than 140 addresses recorded realized losses exceeding $1 million, demonstrating that substantial losses remain possible. 

The defioasis.eth analysis noted that addresses with numerous open positions might show artificially negative realized results. This occurs because unrealized gains on current holdings do not factor into the calculation.

The research methodology subtracted total purchase costs from combined sale proceeds and redemption payments. 

This approach offers a snapshot of realized trading performance across the platform. The findings suggest that consistent profitability on Polymarket remains difficult for most participants, with returns heavily concentrated among a small percentage of addresses.