Polymarket abandons Polygon and builds its own Ethereum L2

The Polymarket prediction platform is accelerating its technological independence with the launch of a proprietary Layer 2 solution based on Ethereum. The decision marks a radical shift after the December 18 incident, when a critical failure in Polygon caused a complete service outage. This episode revealed the risks of relying solely on shared infrastructure, catalyzing the internal migration strategy.

Polymarket’s new L2, called POLY, represents not just a technical migration but a complete restructuring of the infrastructure stack. The platform will discontinue its relationship with third-party providers like GoldSky and Alchemy, seeking full control over its indexing and data services. This architecture, kind of like Polygon but decentralized in its own hands, offers Polymarket greater operational resilience and reduced latency.

The implementation schedule is ambitious. The team plans to activate markets with 5-minute cycles later this week, demonstrating that the new environment is already functional for high-frequency use cases. This acceleration in execution times could amplify volatility and, consequently, influence sentiment metrics such as the crypto fear and greed index.

The transition reflects a broader pattern in the DeFi ecosystem: established platforms seek technological autonomy instead of relying on generic Layer 1s or L2s. For Polymarket, its own L2 is a competitive advantage that enables real-time prediction markets, aligned with the growing demand for hedging instruments and rapid speculation in the crypto market.