- Researchers have found traders may have been manipulating Polymarket’s five-minute BTC bets.
- The study traced the activities to Binance.
- The researchers said the flaw could affect other platforms that offer similar contracts, not just Polymarket.
A new study suggests traders may be manipulating Polymarket’s five-minute Bitcoin bets to swing wagers their way.
Researchers at Stanford University and Singapore Management University said they examined roughly 16,000 of Polymarket’s five-minute Bitcoin contracts for two months, finding signs that traders may have been manipulating spot price on Binance.
“In the final seconds before settlement, Binance spot order flow spikes, resulting in price movements that revert shortly after settlement,” the paper reads. “Clearly, this is a transitory push to manipulate the spot price, not trading on information.”
Research faults Binance over Polymarket’s manipulation
Polymarket uses a Chainlink oracle for its five-minute contracts, which takes the average BTC price across major spot exchanges. However, the researchers said Binance was “an economically tight proxy” for the oracle pricing, considering its volume.
Binance’s mid price stays extremely close to the oracle such that “a push that drives the Binance mid a few basis points past the strike reliably carries the resolution,” the researchers said, adding that contract finishes on the same side as Binance 85% of the time.
The study suggested other trading platforms offering similar contracts could face the same vulnerability, not just Polymarket, because of how the bets resolve.
“These contracts have a structural vulnerability,” one of the paper’s authors said. “They settle on a price that traders can move by trading the underlying asset itself.”
Polymarket responds to bet manipulation concerns
Speaking on the findings, a spokesperson for Polymarket said the platform is looking to change some of its market to settlement methods that use prices over a longer period rather than a single point in time, in the coming year.
Polymarket has previously been in the news for manipulation concerns.
Last year, a Columbia University study found that 25% of Polymarket’s trading activities over the past three years were artificial and arranged through wash trading, Cryptopolitan reported.
In March 2026, Polymarket tightened its market integrity rules across its CFTC-regulated US exchange and DeFi platform. The new rules cover the firm’s market design standards, resolution criteria, and data sourcing requirements.
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FAQs
Who conducted the Polymarket manipulation study?
Researchers at Stanford University, working with an assistant professor at Singapore Management University named Shihao Yu, authored the working paper.
How could traders manipulate Polymarket's Bitcoin bets?
Because the five-minute contracts settle on Bitcoin's spot price, a bettor can trade Bitcoin on an exchange like Binance in the final seconds to move that price toward the outcome they wagered on; in near-even windows, Binance order flow ran about 3.9 times its normal level.
What is Polymarket doing in response?
The company points to its use of multiple independent pricing oracles and says it plans to move some markets over the next year to settlement based on prices measured over a longer period rather than a single point in time, a change it says will further ensure market integrity.
Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
Ibiam Wayas
Ibiam Wayas has covered the crypto news beat since 2019. He studied Computer Science at National Open University of Nigeria. His work has appeared on various crypto news platforms, including Coinfomania, Crypto News Australia, and AltcoinBuzz. Drawing on his background in Computer Science, he now focuses on crypto, robotics, and longevity news.
