Polymarket becomes independent: the economic calculation behind leaving Polygon

By the end of December, Polymarket confirmed its plan to migrate from Polygon to a proprietary Layer2 network built on Ethereum, marking a turning point in the strategy of the most prominent prediction platform in the market.

When applications surpass infrastructure

Polymarket’s move is not a coincidence but reflects a common dynamic in the crypto industry: when an application reaches sufficient scale in users and value generation, the underlying infrastructure ceases to be an advantage and becomes a limitation.

Polygon has experienced recurring failures in its (latest on December 18) network, and its ecosystem has lost comparative appeal. Polymarket, with its exponential growth, requires a more robust and customizable environment. Building its own Layer2 is not just about seeking operational stability but designing an infrastructure that specifically adapts to the platform’s requirements, allowing meaningful iterations in its governance model and facilitating future product improvements.

The real prize: capturing economic value

But the financial calculation is deeper. By creating its own network, Polymarket consolidates a closed ecosystem where all economic activity generates internal value, preventing benefits from “leaking” to external networks.

The magnitude of this impact is significant:

• Monthly active users: 419,309 (historical: 1.76 million)
• Monthly transactions: 19.63 million (historical: 115 million)
• Monthly trading volume: $1.538 trillion (historical: $14.3 trillion)
• Funds locked in the platform: approximately $326 million

These numbers make sense when contrasted with the Polygon ecosystem: Polymarket accounts for roughly a quarter of the total funds locked in Polygon ($1.19 billion) and consumed 23% of the gas in November (216,000 dollars out of $939,000 total).

Visible and invisible contributions

Beyond quantifiable metrics, Polymarket has activated complex economic dynamics within Polygon: every transaction settles in USDC, generating sustained demand for stablecoins. Users, for convenience, explore other DeFi protocols within the ecosystem, multiplying the network’s value.

These “invisible contributions” are the most valuable and scarce: real demand, user retention, and deep liquidity.

Timing: the TGE as an accelerator

Why now? The answer lies in Polymarket’s plans to launch its token soon. Once the token is active, its governance structure, incentives, and economic model will be crystallized. A subsequent migration would be exponentially more complex and costly.

Additionally, transforming from a “single application” to a “full stack” (application + proprietary infrastructure) completely redefines the valuation narrative. A proprietary Layer2 significantly expands growth potential and perceived value in capital markets.

The relentless logic

Essentially, this migration reflects a structural truth: when applications can independently support their users, traffic, and economy, if the infrastructure does not add differential value, it will inevitably be abandoned. There is no ideology, only incentive calculation.