Polymarket fees explained in plain English
To fully understand Polymarket’s fees, you need to first understand the difference between Takers and Makers on the platform:
- Takers are the people who purchase immediately at any price, thereby “taking” liquidity out of the market.
- Makers are the people who place limit orders that wait to be matched, which adds liquidity to the market.
This platform treats these two groups of people differently when it comes to fees, specifically by charging fees to Takers only. The platform does not charge Makers trading fees, and some markets may offer liquidity incentives for placing limit orders.
Secondly, it’s important to note that the site offers a sliding fee scale, where the fees are highest when the market is at its most uncertain. This means that the closer the price of an event contract is to 50¢, the more that Takers will pay in fees. You’ll pay lower fees when you’re buying and selling event contracts that are at the extremes of the price range, such as 5¢ or 95¢.
The third factor that can affect fees is the market type and its fee settings. Some markets may have zero taker fees, while others use Polymarket's standard fee structure. The exact fee depends on the specific market, so it is worth checking the details before trading.
Generally speaking, you can avoid fees altogether if you place limit orders where you wait for a trade to be executed at a specific price, or if you trade event contracts in the applicable geopolitical markets. If you trade as a Taker, the fees you pay depend on the specific market, so always check the current fee details before placing a trade. This also applies when exploring Polymarket election markets and other event categories.
Let’s look at the specific formula and some examples to further explain these fees…
What is the formula for calculating Polymarket fees?
The specific formula this platform uses to calculate fees is as follows:
Fee = C × feeRate × p × (1 - p)
The “C” here refers to the number of shares you trade, while the “p” refers to the price.
Here’s a sample of some of the fee rates you’ll use in the above formula:
| Category | Taker fee rate |
| Crypto | 0.07 |
| Economics, Culture, Weather, General/Other | 0.05 |
| Finance, Politics, Tech | 0.04 |
| Sports | 0.03 |
Now let’s look at a couple examples to see how much you’d pay in fees for two distinctly different fee structures: crypto and sports…
Example 1: Crypto trades
For this example, we’re going to take the most expensive prediction market to trade in (crypto), and look at what happens when you trade in a highly uncertain market, which further raises the fees.
Let’s suppose you’re trading 100 shares at 50¢ each. The base formula is as follows:
C × feeRate × p × (1 - p) = fee
When we insert the numbers that are specific to this example, we get the following:
100 x 0.07 x 0.50 x (1- 0.50) = $1.75
Now take the total number of shares (100) and multiply by the price per event contract (50¢) = $50 for the event contracts. Add that to the total fees ($1.75), and the cost of the entire trade is $51.75.
Now let’s compare that to the next example…
Example 2: Sports trades
For this next example, we’ll look at what happens when you execute trades in the Polymarket sports markets as a Taker. To make it easier to compare this example with the previous example, we’ll stick with the 50¢ price per event contract, and 100 shares. The difference here is the lower category fee of 0.03. Here’s the formula:
100 x 0.03 x 0.50 x (1-0.50) = $0.75. In this case, the total price of the 100 event contracts plus the fees is $50.75.
You get the idea. You can use the formula and insert the Taker fee rate, the price per event contract, and the total number of shares to calculate exactly how much you’ll pay for any trade. If you’re looking at lowering your fees, which potentially increases your profits if you’re right about your predictions, then read on…
5 insider tips for lowering your Polymarket fees
If you’re looking for ways to lower your Polymarket fees and trading costs, then you’ll want to consider both the fees as well as the hidden costs. Check out these tips:
Be a Maker
We’ve mentioned this earlier, but it’s worth mentioning again: you can eliminate your fees entirely by adding liquidity to the market by placing limit orders. In some cases, you may get a percentage of the Taker’s fees back as a rebate, with the percentages ranging from about 20% to 25%. For example, if the Taker is paying $2 in fees on a trade with you, you could get 50¢ of those fees (25%).
Don’t jump in and out of markets
Remember that your fees apply for each trade you make. When you buy or sell as a Taker in a fee-enabled market, you pay the applicable fee for that trade. If you frequently exit one contract and enter another, those costs can add up. Select your event contracts carefully, and have a strategy in place before you start trading to reduce expensive mistakes caused by emotional decisions.
Focus on high-liquidity markets
The more buyers and sellers there are in a prediction market, the easier it is for you to enter and exit these markets. Picking these sorts of high-liquidity markets makes it easier for you to trade event contracts that have fewer hidden costs, slippage, or big spreads. This also means you should avoid trading during the overnight hours, weekends, or even during major holidays or other events, as the markets usually have less liquidity during those time periods.
Avoid uncertain markets
Whenever possible, stay away from trading on specific prediction markets where the event contracts are priced at or near 50¢, as this trading activity incurs higher fees.
Understand the hidden costs
Many traders focus entirely on the fees, without taking into consideration the hidden costs. For example, you’ll want to look at the spread, which is the difference between what you want to buy a contract for, and the price someone wants to sell it. Big bid-ask spreads can make a trade more expensive. Another issue is slippage, where you’re burning through an order book buying up event contracts, but they are becoming more expensive as you do so.
Pros and cons of Polymarket fees
- Makers have zero fees and may get small rebates
- The fees are transparent and easy to calculate
- Takers can trade in a way that reduces their fees
- There are hidden costs that can impact your overall cost
Final thoughts on Polymarket fees
As you just learned, Polymarket has a transparent fee structure, including a simple formula you can use to calculate your fees. Makers don’t pay trading fees, and some markets may offer liquidity incentives or rebates. Takers pay fees, but they can lower their costs with smart trading strategies. For example, some geopolitical markets may have zero taker fees, while other markets may use different fee structures. Choosing contracts with more certainty, meaning Polymarket prices closer to $0 or $1, will also result in lower taker fees.
When you’re ready to jump into the prediction markets and begin trading event contracts at Polymarket, you can get started by tapping the brand’s banner on this page. You can also use a Polymarket referral code, if available. Happy trading!
Polymarket fees FAQs
How does the saying ‘patience pays off’ apply to prediction markets?
Makers trade with patience, by waiting for the right price rather than executing a trade immediately, and this patience creates zero fees. There are other cases where patience pays off, such as by not immediately reacting to breaking news, or by making emotionally driven trades.
Does this brand offer any bonuses to help offset Polymarket fees?
If there are any bonuses currently available, including those requiring a Polymarket promo code, you’ll find the information by checking out the brand’s banner on this page.
What is a common beginner’s mistake?
Many beginners overtrade, in that they’re jumping in and out of markets, which just creates more fees and potentially more slippage. It’s a good idea to start with small trades to learn how trading works, and then scale up once you start getting good results. You can learn more about this brand’s prediction markets and what kind of experience you can expect by reading our Polymarket review.
