It appears that a limited number of traders are dominating prediction markets, with an even smaller group accumulating the majority of the profits. According to a report by blockchain analytics firm Solidus Labs, the concentration of profits on Polymarket is stark, with less than 1% of wallets accounting for approximately half of all gains in key markets. Between December 2025 and February 2026, just 0.55% of profitable maker wallets captured 50% of gains in Polymarket's politics markets, while 0.26% of winning taker wallets accounted for nearly the same share, translating to around $8 million out of $16 million in profits. This data reinforces previous academic findings that a small minority of traders drives most price discovery, with roughly 3% of Polymarket traders responsible for this phenomenon.
The significant disparity in profits highlights a key point: that concentration does not necessarily imply wrongdoing, but rather that some traders possess greater sophistication, capital, or speed in acting on information. However, the report suggests that the scale of this imbalance indicates a structural divide between a small group operating with significant advantages and the broader base of participants. The study also identifies signs of wash trading, with approximately 15% of volume in some markets exhibiting patterns consistent with self-trading or economically neutral positions. Solidus' findings are based on verifiable on-chain data, although the firm's role as a market surveillance platform provider may influence the report's framing and conclusions.