Polymarket Arbitrage Bot

A Polymarket trading bot can start as a simple strategy connected to an API. For a prototype, that may be enough. But reliable automated trading requires much more than placing an order. The backend needs to handle: Market data Orderbook state Strategy Risk and position Execution Order management Reconciliation Monitoring At that point, the strategy is only one part of the system. You're building a trading system backend. The Architecture The system I'm building can be understood as nine main layers. 1. Market Data WebSocket / API ↓ Market Data Worker 2. Market State Market Data Worker ↓ Market / Orderbook State 3. Event Processing Market / Orderbook State ↓ Queue / Redis 4. Decision Making Queue / Redis ↓ Strategy Worker 5. Execution Strategy Worker ↓ Execution Intent ↓ Execution Worker 6. Order Management Execution Worker ↓ Order Management ↓ External Market 7. Reconciliation External Market ↓ Orders / Fills ↓ Reconciliation Worker 8. Persistence Reconciliation Worker ↓ Inter...

A review of Polymarket's public leaderboard turned up a number worth sitting with: 14 of the 20 most profitable wallets on the platform are bots. Not assisted by bots. Not partially automated. Fully bot-run. If you're trading manually on Polymarket right now, you're competing against a leaderboard that's already three-quarters automated. This isn't a fringe statistic - it's the clearest evidence yet that Polymarket has quietly become a bot-dominated market, and the mechanics behind why are worth understanding whether you're building a Polymarket trading bot yourself or just trying to figure out if manual trading still makes sense. Where the edge is actually coming from The instinct is to assume these bots are winning because they're better at predicting outcomes. That's mostly not what's happening. Research on Polymarket arbitrage estimates that traders extracted roughly $40 million from the platform between April 2024 and April 2025 by exploi...

When building a Polymarket trading bot, it's easy to focus on prediction models, latency, and order execution. However, platform infrastructure changes can have an even greater impact on a trading system than a new strategy. With Polymarket introducing TWAP (Time-Weighted Average Price) settlement for crypto Up/Down markets, I spent the last few days reviewing how my bot behaves near market resolution. Supporting TWAP wasn't simply replacing one price calculation-it required rethinking assumptions around settlement, execution timing, and trade evaluation. This update reminded me that trading bots aren't static software. They're living systems that must evolve alongside the markets they interact with. Over the coming weeks, I'll share a detailed technical breakdown covering the architecture changes, implementation decisions, and lessons learned while updating my Polymarket trading bot for the new TWAP model.