Polymarket Plans Native Stablecoin as Part of Major Exchange Overhaul

Polymarket is preparing to launch its own stablecoin alongside a full rebuild of its trading infrastructure, marking the most significant upgrade since the platform’s inception.

The prediction market platform said the overhaul will roll out over the next several weeks and includes a redesigned trading engine, new smart contracts, and a proprietary collateral token called Polymarket USD. The token will replace USDC.e, a bridged version of USDC currently used on the platform, and will be backed 1:1 by USDC issued by Circle.

A Rebuilt Exchange Stack

At the center of the upgrade is a new version of Polymarket’s Conditional Token Framework (CTF) Exchange, referred to as V2. The updated system introduces a more efficient matching engine and a streamlined order structure designed to reduce computational overhead and gas costs.

The platform is also deploying a revised central limit order book (CLOB), combining off-chain order management with on-chain execution. According to developer documentation, the new architecture reduces the number of steps required to validate and match trades while enabling tighter spreads and faster execution.

Additional features include support for EIP-1271, allowing smart contract wallets to sign orders directly, and developer tooling to track order origins on-chain.

Polymarket said the transition will require a full reset of its order books. All open orders will be canceled during a scheduled maintenance window, with advance notice provided to users.

Introducing Polymarket USD

A key component of the overhaul is the introduction of Polymarket USD, a native collateral token designed to standardize settlement across the platform.

The token will replace USDC.e, which some users have viewed as less reliable due to its bridged nature. By moving to a natively controlled asset backed directly by USDC, Polymarket aims to improve liquidity consistency and streamline the trading experience.

For most users, the migration will be handled automatically through the interface with a one-time approval. More advanced users and API traders will need to manually convert their holdings via a dedicated onramp contract and update integrations to align with the new system.

“The frontend handles wrapping automatically with a one-time approval prompt,” the company said. “Power users and API-only traders will need to wrap their USDC or USDC.e into Polymarket USD via the Collateral Onramp contract’s wrap() function.”

Positioning For Growth

The infrastructure upgrade comes as Polymarket continues to scale rapidly, having reportedly surpassed $10 billion in monthly trading volume and securing a $2 billion investment from Intercontinental Exchange (the parent company of the New York Stock Exchange) in October.

Polymarket is working toward regulatory alignment in the United States through registration with the Commodity Futures Trading Commission, and has also expanded its data and analytics capabilities through a collaboration with Palantir Technologies focused on monitoring sports betting markets.

By controlling its collateral layer and core exchange infrastructure, Polymarket is positioning itself to operate more like a fully fledged exchange rather than a standalone application.