The market for betting on future events has surpassed $20 billion in monthly trading volume for the first time amid a surge of activity tied to geopolitical conflict and U.S. politics.
Monthly transaction volume across prediction markets has grown from from $1.2 billion in early 2025 to over $20 billion, with unique wallets more than tripling to 840,000 in the six months leading up to February 2026, according to a report from blockchain analytics firm TRM Labs.
Per the report, geopolitical events, macroeconomic outcomes, and U.S. political developments now account for the bulk of trading activity, overtaking crypto-native markets that previously dominated these platforms.
Based on user dynamics, TRM identified four defining features of Polymarket’s market structure. Geopolitics dominates at the top end, with volume fragmenting across overlapping questions on leadership outcomes, conflict scenarios, and policy events rather than coalescing around a single narrative. U.S. politics remains a core secondary pillar, with contracts tied to domestic political events consistently ranking among the highest-volume markets.
Crypto price markets represented a consistently small share of activity at every experience level, the report said, with sports and entertainment betting peaking among mid-tier active traders and the most experienced market makers, not among newcomers.
The report also noted that Polymarket’s design does not distinguish between “serious” or “non-serious” markets or event contracts by instrument classification, offering a consolidated “super app” experience where users can trade political, cultural, and crypto outcomes on a single platform.
According to the report, the 10 most profitable Polymarket wallets in early 2026 reflected three strategies, including “macro conviction, algorithmic market-making, and event-driven opportunism.”
The top wallet earned $6.2 million across diverse markets, including Fed decisions, the World Cup, and the 2028 election. Six of the ten wallets traded every day over the 80 days from Jan. 1 to March 22.
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TRM Labs analysts said they observed behaviors that resemble forms of market manipulation as defined in traditional finance, including coordinated wallets entering positions ahead of major news, accounts funding once to place a single high-conviction bet and exiting immediately after resolution, and thin markets where a single participant dominates pricing.
One example cited in the report involved four wallets that collectively turned roughly $40,000 into $872,000 betting on U.S. military action against Iran in January and February 2026. All four entered markets priced between $0.10 and $0.80 per share and redeemed at $1 when the markets resolved.
The report noted shared infrastructure between the wallets, saying that all four funded positions through the same bridge within a narrow time window, swept balances after collecting winnings, and have not re-entered the market.
On March 23, 2026, both Kalshi and Polymarket publicly outlined new measures to curb such activity, including restrictions on participants with access to non-public information and enhanced integrity controls, the report said.
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