Most prediction market traders incur losses, with only a few high-frequency trading bots being profitable.

April 29 — Per Bloomberg data, Polymarket reports at least 1,000 accounts have lost over $100,000, nearly double the number of profitable accounts with the same $100k threshold. A group of ~823 highly active accounts (classified as BOTS due to significant daily trading volume) collectively netted ~$131 million in profits. Excluding these BOTS, all other traders posted a net loss of $131 million. The report notes prediction markets—with annualized trading volume topping $500 billion and growing—are now dominated by a handful of automated programs. On Polymarket alone, just ~5% of suspected BOT wallets drive 75% of the platform’s trading volume. These BOTS use high-frequency arbitrage across markets, entering trades earlier and at better prices to lock in higher returns. By contrast, ordinary traders often lose money even when they correctly predict trends, as delays push them to execute trades at unfavorable price points. A recent market trend study found 68.8% of traders analyzing sentiment and geopolitical events on platforms like Polymarket have been in losing positions since 2022. Data also shows the biggest losing user group has the most trading activity clustered around extreme price levels (odds below 10% or above 90%), while top earners have the lowest share of trades in that range.