Key Highlights
- Polymarket will switch to TWAP-based price resolution for crypto markets on August 7 to reduce manipulation risks.
- The platform is introducing $1 million in liquidity rewards while integrating Chainlink TWAP feeds and Real-Time Data Streaming (RTDS).
- The changes are designed to improve market integrity, although broader adoption will depend on participant uptake and reliable oracle infrastructure.
Polymarket, the decentralized prediction market platform, announced an upgrade to its crypto prediction markets by replacing single-price snapshots with a time-weighted average price (TWAP) mechanism, a move aimed at making market outcomes more resistant to short-term price manipulation.
According to an announcement posted by the Polymarket Developers account on Thursday, the new pricing model will take effect on August 7, 2026, at 12:00 a.m. UTC. Instead of resolving markets using a single price at expiration, Polymarket will calculate outcomes using an average price over a defined period, reducing the impact of sudden price spikes or flash moves around settlement.
How Polymarket’s new TWAP system will work
The platform will apply different averaging windows depending on the contract duration:
- All crypto 5-minute markets will use a 30-second TWAP
- All crypto 15-minute markets will use a 60-second TWAP
- All crypto 4-hour markets will use a 60-second TWAP
According to Polymarket, the new methodology is intended to make it more difficult for individual traders or coordinated participants to influence market outcomes through short-lived price movements.
Chainlink and liquidity rewards power the rollout
To support the transition, Polymarket is allocating $1 million in liquidity incentives across eligible crypto markets throughout August. The platform also confirmed that Chainlink TWAP testnet feeds are already live, while mainnet feeds and Polymarket’s Real-Time Data Streaming (RTDS) infrastructure are scheduled to launch on August 4.
Builders will be able to access TWAP data through Chainlink Data Streams or Polymarket’s public WebSocket, complete with integration guides, SDK examples, and feed IDs.
Industry faces continued regulatory scrutiny
The announcement comes as prediction markets continue attracting regulatory attention in the United States. Earlier this week, U.S. District Judge Katherine Menendez temporarily blocked Minnesota’s law that would have prohibited prediction markets and imposed criminal penalties on operators and advertisers.
The preliminary injunction paused the legislation before its scheduled Aug. 1 implementation, allowing prediction market platforms to continue operating in the state while litigation proceeds. The ruling marked a significant legal victory for the industry, with the court finding that the plaintiffs had demonstrated a likelihood of success on key legal arguments and would face irreparable harm if the law took effect.
Why some challenges still remain
While the introduction of TWAP appears positive on the surface, it may signal deeper issues within Polymarket’s ecosystem. Constantly patching resolution methods highlights fundamental vulnerabilities in decentralized prediction markets; if manipulation was possible via snapshots, sophisticated actors may eventually find ways around TWAP as well.
The need for $1 million in liquidity raises questions about organic demand and whether the platform is overly reliant on incentives to sustain activity. Furthermore, increased complexity from Oracle dependencies and data streaming requirements could raise barriers for smaller participants, potentially centralizing liquidity among professional market makers.
In a space already plagued by regulatory scrutiny, such frequent mechanical changes might invite accusations of moving goalposts, eroding user trust. Ultimately, no technical fix can fully eliminate human greed or market distortions, suggesting that Polymarket’s “integrity” upgrades might merely delay rather than solve underlying design challenges in crypto prediction betting.
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