Polymarket has unveiled a major upgrade to its trading infrastructure, the latest update following fee changes and integrity measures amid scrutiny of the platform.
Polymarket has announced a major upgrade to its exchange infrastructure, including a new trading system, updated order book mechanics, and a proprietary collateral token, marking the latest in a series of platform updates that have recently included fee changes, new integrity measures, and surveillance partnerships, as scrutiny around the prediction market operator continues to build.
The update, outlined in a company post on X, represents one of the most significant technical changes to the prediction market platform to date, aiming to improve performance and enhance developer functionality.
Exchange Upgrade Aims to Improve Speed and Usability
One of the biggest changes is the introduction of CTF Exchange V2, an upgrade to Polymarket’s core trading system.
In simple terms, the update will speed up and enhance trading efficiency. At the same time, it’s making it easier for developers to build tools and integrations on top of the platform.
According to Polymarket, the new system will improve how trades are processed and matched. Additionally, it introduces new features that allow developers to better track and attribute trades to their origins.
Advanced users who run trading bots or use the platform through APIs will need to make some adjustments. They will need to update their software and reconnect to the new system.
Polymarket has warned that all existing order books will be cleared during a short maintenance window. The operator added that it will release updated developer tools for TypeScript, Python, and Go ahead of the switch, along with guides explaining the changes.
Polymarket said it will announce the exact date and time of the update at least one week in advance.
New Collateral Token Introduced
Polymarket is also changing how funds are handled on the platform. It’s replacing its current token (USDC.e) with a new Polymarket USD token, backed 1:1 by USDC.
For most users, this change should happen automatically, with the platform handling the conversion after a one-time approval.
However, more advanced users will need to manually convert their funds using a dedicated tool.
Overall, the change gives Polymarket more control over how money flows within its system, rather than relying on external token setups.
Product Expansion Continues Alongside Fee and Integrity Updates
The infrastructure overhaul builds on a series of recent platform changes aimed at expanding revenue and strengthening market integrity.
At the end of March, Polymarket introduced fees across most markets and launched a referral program offering up to 30% of trading revenue to users.
On the same day, the platform announced new measures to curb insider trading and market manipulation. The update centered on expanded market integrity rules across its international cryptocurrency platform and its U.S. exchange.
The rules clarify three categories of prohibited trading:
- Trading on stolen confidential information
- Trading on illegal tips
- Trading by individuals who can influence the outcome of an event
After announcing the new rules, Polymarket said it would rely on multi-layered surveillance to enforce them. That includes a previously announced partnership with Palantir Technologies and TWG AI to develop a new artificial intelligence-powered surveillance platform.
Market Controversy Highlights Ongoing Moderation Challenges
The upgrade also comes days after renewed criticism of the platform’s market moderation practices.
Over the weekend, a market was briefly listed, allowing users to bet on the outcome of a search and rescue operation involving a missing American service member whose aircraft had reportedly been shot down over Iran.
U.S. Representative Seth Moulton condemned the listing, stating:
There is an ongoing search and rescue operation for a missing American service member whose plane was shot down over Iran… And people are betting on whether or not they’ll be saved. This is DISGUSTING.”
Polymarket removed the market shortly after and responded publicly:
We took this market down immediately as it does not meet our integrity standards. It should not have been posted, and we are investigating how this slipped through our internal safeguards.”
Moulton is among a growing number of members of Congress who have criticized prediction markets. He recently announced that he has implemented a policy prohibiting his staff from participating in prediction markets.
Moulton, along with several other members of Congress, also sent a letter to Commodity Futures Trading Commission (CFTC) Chairman Mike Selig, asking for an explanation as to why the agency, which oversees derivatives trading, has failed to take action against offshore prediction market platforms—such as Polymarket—that are allowing bets on U.S. military operations.
Polymarket has received significant criticism over markets tied to military actions, including U.S. military action in Iran and Venezuela.
Lawmakers at the federal and state levels have introduced multiple bills addressing contracts for certain events, such as war or military actions. In addition, public comments on CFTC’s proposed rules for prediction markets have raised concerns about war and gambling markets, manipulation, and the public interest.
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