Polymarket Bitcoin bets may have been influenced by traders pushing Binance spot prices moments before settlement, according to a new study.
Researchers from Stanford University and Singapore Management University reviewed about 16,000 five-minute Bitcoin contracts over two months and found patterns pointing to possible manipulation.
The study focused on contracts that resolve according to whether Bitcoin finishes above or below a set price. Researchers found that Binance spot order flow increased sharply before settlement, moving prices before they reversed soon afterward.
“In the final seconds before settlement, Binance spot order flow spikes, resulting in price movements that revert shortly after settlement,” the paper said. “Clearly, this is a transitory push to manipulate the spot price, not trading on information.”
Binance Prices Closely Track Oracle Results
Polymarket uses a Chainlink oracle to settle its five-minute Bitcoin markets. The oracle calculates an average Bitcoin price from spot exchanges. However, researchers described Binance as “an economically tight proxy” for that settlement price due to its trading volume.
According to the study, Binance’s midpoint price stayed extremely close to the oracle value. Researchers said a trader could push Binance’s midpoint several basis points beyond the contract strike and affect the final result.
The paper found that contracts settled on the same side as Binance’s price 85% of the time. Researchers therefore linked the observed order flow to efforts aimed at influencing contract outcomes rather than responding to new market information.
Structural Risk May Extend Beyond Polymarket
The researchers said the issue may not be limited to Polymarket. Other platforms offering contracts with similar settlement structures could face the same weakness when outcomes depend on an underlying market that participants can trade.
“These contracts have a structural vulnerability,” one paper author said. “They settle on a price that traders can move by trading the underlying asset itself.”
The findings center on how short-duration markets determine outcomes, particularly when settlement depends on a price measured at a narrow moment. The study traced the activity to Binance spot trading before contract expiration.
Polymarket Reviews Longer Settlement Windows
A Polymarket spokesperson said the company is looking to move some markets toward settlement methods using prices measured over longer periods instead of a single point in time during the coming year.
The platform has faced earlier questions about market integrity. A Columbia University study reported last year that 25% of Polymarket trading activity during the previous three years was artificial and arranged through wash trading.
In March 2026, Polymarket strengthened market integrity rules covering its CFTC-regulated United States exchange and decentralized finance platform. Those rules address market design standards, resolution criteria, and data sourcing requirements across the company’s trading operations.
