Polymarket said it will make a major change to the settlement mechanism for its crypto up-or-down markets starting Aug. 7, replacing single-point price snapshots with time-weighted average price, or TWAP, from 00:00 UTC that day. The company said the move is aimed at protecting market integrity.
Under the new setup, all 5-minute crypto markets will use a 30-second TWAP window, while 15-minute markets and 4-hour markets will use a 60-second TWAP. Polymarket said the previous snapshot-based method was vulnerable to price manipulation during periods of thin liquidity.
The platform also laid out transition measures. It plans to provide $1 million in liquidity incentives across all affected markets throughout August. On the infrastructure side, Chainlink TWAP data streams on testnet are already available. Mainnet streams and Polymarket’s real-time data stream service are scheduled to go live on Aug. 4, after which developers will be able to access TWAP pricing directly through Chainlink Data Streams or Polymarket’s public WebSocket.
Prediction market platform Polymarket said it will make a major adjustment to the settlement mechanism for its crypto up-or-down markets starting Aug. 7, according to an official announcement. The change is intended to protect market integrity.
Settlement will switch to TWAP on Aug. 7
From 00:00 UTC on Aug. 7, affected markets will no longer settle based on a single price snapshot taken at one point in time. They will instead use a time-weighted average price, or TWAP.
Different market durations will use different TWAP windows:
- All 5-minute crypto markets will use a 30-second TWAP.
- 15-minute markets will use a 60-second TWAP.
- 4-hour markets will also use a 60-second TWAP.
Why the mechanism is changing
Polymarket said the previous single-snapshot settlement method could lead to price manipulation during periods of thin liquidity. It described the update as a proactive step to reinforce market integrity after drawing consecutive regulatory attention.
To support the transition, Polymarket said it will inject $1 million in liquidity incentives into all affected markets throughout August.
Data stream rollout
On the technical side, Chainlink TWAP data streams on testnet are already available. Mainnet data streams and Polymarket’s real-time data stream service are scheduled to launch on Aug. 4. At that point, developers will be able to access TWAP prices directly through Chainlink Data Streams or Polymarket’s public WebSocket.
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