Polymarket is forming an internal team that will take the opposite side of user trades on its prediction platform, raising concerns about fairness and transparency.
Quick Summary – TLDR:
- Polymarket is hiring professional traders and sports bettors to staff a new internal market-making desk.
- The desk will trade directly against users, mimicking a structure used by rival Kalshi that has faced legal scrutiny.
- Experts warn the move could blur the line between prediction markets and sportsbooks, hurting trust and platform neutrality.
- The shift could improve liquidity and stability, but also opens the door to potential conflicts of interest.
What Happened?
Prediction market Polymarket is building an internal trading desk to act as a market maker. This team will take positions against users to improve liquidity and platform efficiency. While Polymarket has not officially commented, sources say the company is actively recruiting experienced traders, including professional sports bettors.
This controversial step mirrors a model already adopted by competitor Kalshi, which is currently facing a class-action lawsuit over its similar setup.
“Polymarket has been recruiting new staff members for an internal market making team that could face off against customers on the company’s exchange, even though a similar feature has exposed its chief rival to criticism.”
— Alfonso Straffon 🇨🇷🇺🇸🇲🇽 (@astraffon) December 4, 2025
Polymarket Builds In-House Trading Team as It Re-Enters… pic.twitter.com/hVuYT11TKi
Why Polymarket Is Launching a Market-Making Desk?
Polymarket’s move is part of a broader strategy to bolster liquidity and trading reliability on its platform. Market makers ensure users can place trades quickly and at stable prices. Until now, Polymarket has relied on external liquidity providers. Bringing this function in-house gives the company tighter control and flexibility.
According to insiders, the new desk will also support parlay bets through a request-for-quote protocol, potentially offering complex betting options backed by institutional-level capital.
- Improved liquidity means faster execution and reduced slippage.
- Tighter spreads make it cheaper for users to trade.
- Consistent pricing could support riskier or niche market launches.
These operational upgrades are being framed as a sign that prediction markets are maturing into more professional financial platforms. But the decision is not without controversy.
Critics Say It Looks Too Much Like a Sportsbook
Industry experts have expressed serious concerns. Harry Crane, a statistics professor at Rutgers University, told CoinDesk that the in-house desk is a misguided attempt to monetize without charging fees.
“They don’t make money. They want to find a way to monetize,” Crane said, warning the move could lead to legal and reputational problems if the desk becomes too profitable.
Critics say the move shifts Polymarket away from being a neutral marketplace. Instead of merely matching trades between users, Polymarket will now sometimes be the counterparty itself. That structure is how traditional sportsbooks operate, where “the house” sets the odds and profits from user losses.
“It’s a bad business decision that makes Polymarket look just like everyone else,” Crane added.
Legal and Ethical Risks Loom
Polymarket is no stranger to regulatory scrutiny. The company previously paid $1.4 million in 2022 to settle charges tied to unregistered offerings. While it has returned to operating in the U.S. with federal approval, some states still question whether prediction markets are just another form of illegal gambling.
The optics of this shift are particularly sensitive, given that Kalshi, which also uses an internal trading unit, is facing a lawsuit alleging it rigs odds to favor itself. Kalshi denies those claims, calling the suit a “smear campaign.”
But the issue isn’t just about optics. Experts warn that in-house desks could misuse internal data, such as order flow or user deposit timing, to gain an unfair trading edge. Similar concerns plagued the FTX-Alameda relationship before its collapse.
What This Means for Polymarket’s Brand?
During the 2024 U.S. elections, Polymarket became a trusted source for probability-based forecasting. Its market prices were cited alongside polls in major news outlets. This reputation relied on the assumption that its markets were powered by the collective insight of users, not a hidden house trading against them.
By launching its own desk, Polymarket risks undermining the very transparency and neutrality that fueled its growth.
While tighter spreads and deeper liquidity may improve user experience on the surface, trust could erode if users believe they are betting against an insider with more information.
SQ Magazine’s Takeaway
I get why Polymarket is doing this. Better liquidity, faster trades, and smoother markets all sound great. But let’s be real: trading against your own users is a slippery slope. Prediction markets are supposed to be open and user-driven. If you start acting like a sportsbook, people will treat you like one. And no one trusts the house. Polymarket built its name on being different. This move makes it look just like everyone else, and that’s disappointing.
