Prediction market platform Polymarket has announced its largest infrastructure upgrade since launch, set to roll out over the next 2–3 weeks. The comprehensive overhaul involves rebuilding its core trading engine, introducing a new hybrid Central Limit Order Book (CLOB) model, and launching a native USDC-backed stablecoin called Polymarket USD.
The technical core of the upgrade is the new CTF Exchange V2 smart-contract system, which will completely reconstruct the platform's matching engine. This system employs a hybrid-decentralized model, where order matching is handled off-chain by an operator for performance, while settlement remains non-custodial and on-chain for security. This architecture is designed to improve matching efficiency and significantly reduce gas costs for traders.
A key component is the launch of Polymarket USD, a stablecoin pegged 1:1 to Circle's USDC and deployed natively on the Polygon network. This move formalizes a shift away from the bridged USDC.e token, aiming to eliminate cross-chain bridge risk and provide a more capital-efficient and secure collateral asset. Deposits from networks like Ethereum, Solana, Arbitrum, and Base will be automatically converted into Polymarket USD on Polygon.
To attract institutional users, Polymarket will add support for the EIP-1271 (ERC-1271) standard. This allows smart-contract wallets, such as Safe multi-sig setups, to validate signatures and trade directly on the platform, expanding access for DAOs and funds.
The upgrade follows a period of significant growth for Polymarket, which recently secured a $600 million strategic investment from Intercontinental Exchange (ICE). ICE's total commitment, including secondary investments, amounts to $1.6 billion, positioning it as a major backer in the prediction market space. The platform, which has resumed U.S. operations after registering with the CFTC in 2025, now boasts a valuation above $20 billion.
While the announcement confirmed the stablecoin and infrastructure changes, it also hinted at a future POLY governance token. This token, first mentioned in October, could potentially be used for internalizing market outcome resolution and dispute governance, moving away from reliance on UMA's optimistic oracle system.
