A year ago, Polymarket looked unstoppable. Trading on its main platform jumped more than 850% between August and March.
Prediction markets let people bet on real-world events. Polymarket is one of the biggest.
But the growth story stalled this spring. May was the second straight month of falling volume.
The slide is starting to add up. The reversal caught many by surprise.
Start with the crowd. Monthly users dropped from more than 780,000 in March to under 650,000 in May.
Fewer traders means thinner markets. And thinner markets are harder to grow.
Volume followed the crowd out the door, with the main platform handling just under $7.1 billion in May. That's down from about $9 billion in April.
It's also well below March's $10.5 billion peak. That's a sharp turn for a platform that grew nonstop all spring.
It feels like a club that was packed in March and half empty by May. The lights are on, but the room is quieter.
Traders simply had fewer reasons to bet in May. A quieter calendar meant less action.
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The slump is really an overseas story. At home, Polymarket went the other way.
Its U.S. platform grew to $1.77 billion in volume. That's up from $1.26 billion a month earlier.
New users showed up too. The company says the U.S. side added 86% more of them in the 30 days through June 3.
The U.S. push is the bright spot. It shows demand at home is still strong.
Still, that growth couldn't offset the drop abroad. The overall number kept sliding.
Polymarket blames a spring cleanup. It did tech work and switched to a new in-house token called Polymarket USD.
The new token was meant to simplify things. Instead it slowed some users down.
Its overseas bets all settle in crypto, so that switch matters. The headlines didn't help, either.
The platform faced questions about its U.S. management and two insider trading cases. Messy payouts on unclear markets added to the doubts.
Trust matters a lot in betting markets. Meanwhile, rival Kalshi blew past it with more than $17.9 billion in May.
June is off to a stronger start, with $1.9 billion in its first week. That was the busiest week since late April.
Polymarket is betting the FIFA World Cup brings the crowd back. A big event can flip the trend fast.
Prediction markets are still young, so big monthly swings are normal. Still, one strong month won't erase the slide.
The next month will show if May was a dip or a turn.
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