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A Polymarket trading bot is a program that selects a market and outcome, estimates the probability that the outcome occurs, applies risk limits, places orders through Polymarket’s official API using a wallet signer, and then tracks fills, settlement, and positions. The official developer documentation shows how to perform each of those interactions. It does not show that any strategy built on them makes money. A working integration is the starting point for a strategy test, not proof that the strategy works.
How the contract mechanics constrain the engine
Every decision engine has to respect how outcome shares are priced and paid. Polymarket’s FAQ describes outcome shares priced from 0.00 to 1.00 USDC, with the correct final outcome paying 1.00 USDC per share. That FAQ page shows no publication date and is older than the developer documentation, so confirm the current rules before relying on them.
Two design consequences follow. First, the most a share can lose is the amount paid for it. Second, a share’s price is the market’s implied probability, so the bot needs its own estimate to find an edge. For example, buying 100 shares at 0.40 costs 40 USDC. If that outcome resolves correctly, the shares pay 100 USDC, a gain of 60 before fees. If it does not, the shares are worth nothing and the loss is 40. The breakeven probability at that price is 40%, before fees.
The collateral token also needs checking. The FAQ quotes prices in USDC, while the developer quickstart refers to pUSD. Confirm which collateral your account holds and which the current documentation uses before sizing any order.
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The decision engine, stage by stage
The engine runs five stages in order on each decision cycle, with a reconciliation loop that runs alongside them. This sequence is an engineering breakdown of the documented workflow. Polymarket does not prescribe it, and the documentation does not validate any particular stage’s logic.
1. Market and outcome selection
Discover the market, confirm that it is accepting orders, and identify the outcome you intend to trade. Record the market’s protocol version, because it determines which identifier you pass. The documentation distinguishes token IDs for CTF markets from position IDs for Polymarket Protocol V2 markets. The unified client uses the identifier to choose the matching exchange, signing domain, and approval route, so the identifier is functional, not a label. Your engine should reject a mismatched identifier before it builds any order.
2. Probability estimate and the buy decision
The engine converts its information into a probability estimate, which this article calls p. It then compares p with the price it can actually execute at, not the last traded price or a headline-implied number. When buying, that is the ask in the order book. When selling, it is the bid. The gap between p and the executable price, after costs, is the edge. A simple rule buys only when the edge exceeds a threshold you set in advance.
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Illustrative numbers: if the model says 0.55 and the ask is 0.48, the raw edge is 0.07 per share before fees. Whether that edge is real depends on whether the model is calibrated, and you have to test that yourself. The documentation neither prescribes a forecasting model nor validates one. Any model or backtest you publish should include its methodology and should not be presented as an official Polymarket approach.
3. Risk gate
Before an order is built, the engine applies its own controls. The official pages establish market status and order constraints, but they do not set position limits or risk policy. The following are design recommendations you choose and tune:
- A maximum cost per market and a maximum total open exposure across all markets.
- A maximum order size relative to the visible depth at the target price, so one order does not consume the book.
- A staleness limit that refuses to trade when the market data behind the decision is older than a set number of seconds.
- A re-check that the market is still accepting orders and that the tick size and minimum order size being used are current.
- A kill switch and a daily loss limit that stop new orders and leave open positions for review.
4. Order policy
The order policy sets order type, price, and lifetime. The trade-offs are compared in the tables below. Two rules apply regardless of choice. A limit price must sit on the market’s current tick size, and order size must meet the market’s minimum order size. A price that violates the current increment is rejected. Tick sizes can change while a market is live, so the engine should update them from the market data stream rather than trusting a value cached at startup.
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5. Execution-state handling
A successful submission means the exchange accepted the request. It does not mean you hold a position. Store the returned order ID and status, then handle each state as its own branch. The order documentation lists live, matched, delayed, and rejected as order states.
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|---|---|---|
live |
The order is accepted and resting on the book, unfilled or partly filled. | Track remaining size. Cancel or let it lapse according to your policy. |
matched |
The order has matched against a counterparty. | Record the fill. Settlement is still pending, because matched trades settle on-chain asynchronously. |
delayed |
Matching has been delayed. | Do not resubmit. Poll the order by ID until it resolves. |
| Rejected | The exchange refused the order. | Log the reason, correct the input, and do not retry the same request blindly. |
A limit order can fill in parts, so track filled and remaining size separately. A canceled order should be confirmed as canceled before the engine counts the reserved capital as free.
6. Reconciliation loop
Reconciliation compares three records: the bot’s local ledger of intended orders, the exchange’s order and fill records, and the position record after settlement. Run it on a fixed interval and after every state change. The checks are:
- Every local order has a matching exchange order ID and a final status.
- Filled size per order equals the sum of the recorded fills.
- A matched trade is marked settled only after the position reflects it.
- Position size by outcome matches the ledger. Any mismatch halts new orders until it is resolved.
- Cost basis and realized profit or loss are recorded per market so results can be audited later.
Market orders versus limit orders
A market order trades against available liquidity immediately. A limit order names the price you will accept and rests on the book until it fills, expires, or is canceled.
| Factor | Market order | Limit order |
|---|---|---|
| Execution | Immediate, against available liquidity | Only at your price or better, and it may not fill |
| Price control | Low. You accept what the book offers | High. You set the maximum buy price or minimum sell price |
| Rests unfilled | No. It trades against available liquidity immediately | Yes, until it fills, expires, or is canceled |
| Main risk | Slippage through thin depth | A missed fill if the market moves away from your price |
| Use when | Speed matters more than the exact price | The acceptable price matters more than immediacy |
Limit orders also need a lifetime. The order documentation describes two time-in-force options, GTC and GTD.
| Feature | GTC | GTD |
|---|---|---|
| Stays active until | Filled or canceled | The stated expiration, minus a one-minute security threshold documented in the order guide |
| Expiration input | None | Required. The stated expiration must be at least three minutes in the future |
| Operational risk | A forgotten open order keeps capital committed | The order can lapse before a fill you still wanted |
| Use when | The price is stable and the bot will manage cancellation | You want the order to lapse at a known time |
Placing a first order with the unified client
The steps below follow the sequence in Polymarket’s developer quickstart. Exact method names and package names are on the live quickstart page, so copy them from there rather than from this article.
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- Install the official unified client named in the quickstart and confirm it runs in the environment you intend to use.
- Load the wallet private key and wallet address from environment variables, not from source code. The quickstart uses this pattern.
- Confirm the account holds the collateral the quickstart uses. The quickstart recommends at least 10 pUSD for its sample order workflow. That figure applies to that example only. It is not a minimum balance or a general trading requirement.
- Find the market, confirm that it is accepting orders, and note its protocol version.
- Select the outcome identifier that matches that version: a token ID for CTF markets, or a position ID for Polymarket Protocol V2 markets.
- Read the current tick size and minimum order size. Adjust your intended price to a valid tick without moving it past your limit.
- Submit the order. Use a market order when immediacy matters. Use a limit order with a GTC or GTD lifetime when the price cap matters.
- Store the returned order ID and status, then follow the matching state branch in the execution section.
- Wait for settlement. The quickstart says settlement is asynchronous, so check the position after it is recorded rather than assuming it updated at match time.
- Reconcile the position against the local ledger.
Keeping signing credentials under control
- Keep the private key in environment variables or a secrets manager. Never commit it to a repository or write it to logs.
- Where possible, use a separate signer for the bot. The quickstart links to session keys as an option for this.
- Fund the bot only with the amount you are willing to lose, and move profits out on a fixed schedule.
Troubleshooting common failures
- The order is rejected on price. The price may not match the current tick size, which can change while a market is live. Re-read the tick size from the market data stream and resubmit with an adjusted price.
- The order is rejected on size. The size is below the market’s minimum order size. Increase the size or skip the trade.
- A GTD order disappeared before the time you set. Check that the expiration you submitted was at least three minutes ahead. The one-minute security threshold means the order lapses slightly before the stated time.
- The order matched but the position does not show it yet. Settlement is asynchronous. Wait and poll. Do not resubmit.
- A request timed out. Query the order by its ID before doing anything else. Resubmitting blindly can double your exposure.
- The ledger and the exchange disagree. Halt new orders and complete reconciliation before the engine continues.
What the official documentation does not establish
The official pages used for this article confirm the basic order workflow and several order constraints. They do not establish current fees, rate limits, complete market-data or WebSocket message schemas, or the full set of order fields. Check those in the live documentation before writing code against them or quoting them to anyone. The timing values in this article, including the three-minute expiration requirement, the one-minute GTD security threshold, and the 10 pUSD example figure, come from the order guide and quickstart as reviewed for this article. They can change, so confirm them on the live pages before deploying.
Availability is also not covered. Polymarket’s access rules and terms vary by location, and this article does not assess whether you may use the platform where you live. Confirm that before running any automated trading, and remember that, as noted above, no strategy performance is established by the official material.
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