Author: Aleiah, Polymarket Content Creator
Translation: Asher, Odaily Planet Daily
A certain address on Polymarket rolled over $35,000 to $442,000, achieving a 12.6x return. Notably, the position was established hours before a major market movement occurred, and the trades were nearly completed before the news spread to mainstream channels. This isn’t an isolated case; prior to the public release of news about the “Venezuela Raid” political event, three addresses had already positioned themselves and collectively profited $630,000 from the same event.
If such trades occurred in traditional financial markets, it would be easy to think of information asymmetry. But in prediction markets, all fund flows and position changes are recorded openly on the blockchain, with no hidden accounts or private transactions.
Openness doesn’t mean there are no gaps. The key isn’t whether you can see the trades, but whether you can identify truly valuable signals within the massive data.
Every transaction on Polymarket is public data.
Many prediction market participants still view Polymarket as a traditional betting platform: watching odds, choosing directions, placing bets. But Polymarket’s underlying structure is completely different from DraftKings or regular sports betting. All transactions occur on-chain, with fund flows, position sizes, and entry/exit times fully transparent. The most accurate and timely traders are not just guessing afterward; their actions are visible on-chain in real time.
Polymarket’s API is also open. Transaction records, market data, historical trades—anyone can access them directly without restrictions.
Therefore, the gap isn’t about who can see the data, but who can interpret its meaning. On-chain information is public, but the truly valuable insight comes from wallets worth tracking continuously and the ability to detect behavioral changes before prices fully reflect new information.
What features do “insider addresses” typically have?
It’s important to emphasize that not all profitable wallets indicate insider information. Some traders have solid research capabilities; others rely on quantitative models and algorithms. But when profits and specific behavioral patterns repeatedly overlap, certain structural features—beyond luck—can be observed.
· First: New addresses combined with unusually large bets
A wallet created just days ago with very few trades suddenly making large bets in low-liquidity niche markets is uncommon. Especially when there are no public catalysts, large concentrated positions often carry stronger informational significance.
· Second: Highly focused trading in a specific niche
Some addresses don’t operate across multiple markets but focus long-term on a particular segment, maintaining a stable and high win rate. They don’t spread bets across crypto prices, elections, sports, etc., but concentrate on a single theme, making more decisive position decisions.
· Third: Abnormal changes in position size
When a long-term medium-sized bettor suddenly significantly increases their position in a market, it often indicates a shift in judgment strength. Position size reflects attitude; sudden scale changes usually signal upgraded information or conviction.
· Fourth: Overly precise timing
Accidental early positioning can be attributed to luck, but if an address repeatedly completes positions hours before major news releases, and the directions are highly consistent, this timing advantage is hard to explain as mere luck. One occurrence might be coincidence; multiple repetitions suggest an information edge.
How to systematically identify potential “information advantage addresses”
· Step 1: Analyze Polymarket leaderboard performance
Start with Polymarket Analytics (link: sort by 30-day profit/loss, using recent stable profitability as the first filter). Focus on wallets with positive returns over 30 days, a win rate above 55%, and total profits significantly exceeding losses. Also, ensure their trades are concentrated in markets with genuine liquidity, not in low-volume prediction events with little participation.
This stage aims not to directly judge whether they have an information edge but to establish a list of consistently profitable accounts. Stable profits form the basis for further behavioral analysis.
· Step 2: Analyze position structures in specific events
After initial filtering, drill down into particular trades. For active prediction markets, check the Top Holders list for that event. Polymarket publicly displays the largest current positions; these big bets often indicate stronger judgment confidence.
The focus isn’t on whether a single address hits the mark once, but whether their behavior is consistent. If a wallet repeatedly appears among the top positions in multiple key events, especially when these positions are established before the market fully prices in the event, this recurrence itself is a signal.
A single correct guess might be luck, but multiple large early bets aligned with outcomes suggest a stable judgment system.
· Step 3: Analyze trading behavior and timing
After identifying candidate addresses, review their on-chain transaction history, focusing on entry timing, position structure, and pacing.
First, observe when they build positions. If purchases occur hours before official news releases and happen repeatedly, this timing advantage is significant; entering after media reports is more likely following the information.
Next, analyze how they establish positions. Experienced traders often build gradually, adding to positions over time. Those with strong informational insights tend to complete large positions quickly within a short window, due to limited opportunity.
Also, consider their holding periods. Some high-quality addresses exit during the middle of a trend rather than at the tail end of extreme volatility, indicating they aim to lock in main trends rather than chase marginal gains.
Finally, examine their focus areas. Highly vertical, long-term focus on a single niche tends to produce stable informational advantages; addresses frequently operating across multiple sectors may rely more on market sentiment than specific knowledge.
Advanced address tracking strategies
Once basic filtering is mastered, the real edge comes from dissecting the details of fund movements.
First, pay attention to exit behavior, not just entry points. Addresses with an informational advantage often not only position early but also actively reduce holdings before potential downside. When a large, stable position suddenly decreases significantly without obvious catalysts, this change is a strong signal.
Second, perform on-chain wallet clustering analysis. Address relationships are not entirely untraceable. Shared fund sources, similar gas usage patterns, or rapid successive transactions can reveal connections. Many seemingly “new” accounts can be traced back to a long-active core address through 2-3 transfers. Tracking these flows helps identify new high-quality accounts before the market notices.
Additionally, monitor unusual volume spikes in less popular markets. If a normally low-volume market suddenly experiences large inflows without public news, it often indicates early participation by some traders. Analyzing the addresses behind these volume changes can help build new watchlists.
Finally, cross-validate on-chain behavior with external public information. The “Pizza Index,” for example, used unusual pizza orders near Pentagon locations to infer military activity. Similarly, flight tracking, social media activity of key figures, or schedule adjustments can corroborate or challenge on-chain signals. Linking real-world signals with blockchain flows can significantly enhance judgment reliability.
