Understanding Polymarket Fees
How Polymarket calculates taker fees on crypto and sports markets, and how they fund the maker rebates program.
How Polymarket Fees Work
Polymarket does not charge fees on most markets. However, certain market types have taker fees enabled to fund the Maker Rebates Program, which incentivizes deeper liquidity and tighter spreads.
- Taker fees only — Fees are charged when you place an order that executes immediately against an existing resting order. Makers pay no fees and instead receive daily USDC rebates.
- Fee-enabled market types — All crypto markets (since March 6, 2026), NCAAB college basketball, and Serie A soccer.
- Fee-free markets — The vast majority of Polymarket markets have no trading fees.
The Fee Formula
Where:
- C is the number of shares traded
- P is the share price (between $0.01 and $0.99)
- Rate and exp depend on the market type (see below)
Fees are rounded to 4 decimal places. The smallest fee charged is 0.0001 USDC; anything smaller rounds to zero.
Market Types
| Parameter | Crypto | Sports (NCAAB, Serie A) |
|---|---|---|
| Fee Rate | 0.25 | 0.0175 |
| Exponent | 2 | 1 |
| Maker Rebate | 20% | 25% |
| Max Effective Rate | 1.56% | 0.44% |
The exponent controls how sharply the fee curve tapers at the extremes. Crypto markets use exponent 2, meaning the (P × (1 − P)) term is squared — fees drop off much faster near $0.01 and $0.99 compared to sports markets (exponent 1).
Why This Structure?
Like Kalshi, the P × (1 − P) base means fees scale with uncertainty — contracts priced near 50¢ incur the highest fees, while near-certain outcomes at the extremes incur minimal fees.
The key difference is the exponent. Crypto markets use a squared term, which makes the curve steeper and concentrates fees more tightly around the 50¢ midpoint. Sports markets use a linear term, producing a gentler parabola similar to Kalshi's default schedule.
Taker fees are collected and redistributed daily to market makers as rebates, incentivizing deeper liquidity and tighter spreads. See the official Polymarket fee documentation.
Fee Asymmetry
The effective fee rate — fee as a percentage of trade value — is symmetric around $0.50. Buying at $0.20 and buying at $0.80 incur the same effective rate, because dividing the fee by C × P cancels the leading P in the formula, leaving just Rate × (P × (1 − P))exp, which is symmetric.
However, the USDC fee itself is not symmetric. The extra P factor shifts the dollar-fee peak to the right of $0.50 — to P = 2/3 for exponent 1 markets, and P = 3/5 for exponent 2. At P = $0.80, the USDC fee is 4× the fee at P = $0.20, even though the effective rate is identical.
This matters because Polymarket allows traders to mint YES + NO share pairs for $1.00 with no fee. A trader wanting to buy YES at $0.80 can instead mint a pair and sell NO at $0.20, achieving the same net exposure but paying a fee based on P = $0.20 rather than P = $0.80. For exponent 1 markets, this reduces the fee by 75%.
The fee structure is therefore not fully incentive compatible — rational traders are incentivized to always route through the sub-$0.50 side of the book via minting. This could push taker activity toward the low-priced complement, potentially thinning the order book on the high-priced side.