Arbitrage Bots Dominate Polymarket With Millions in Profits as Humans Fall Behind

Core Insights - Bots and AI-driven trading strategies are significantly transforming Polymarket's ultra-short-term crypto markets, enabling automated systems to achieve remarkable profits while human traders struggle to keep up [1][2] Group 1: Bot Performance - A notable example includes a bot that turned $313 into $414,000 within a month by trading in BTC, ETH, and SOL markets with a 98% win rate [2] - Another bot generated $2.2 million in just two months by utilizing ensemble probability models trained on news and social data to exploit market mispricing [4] Group 2: Trading Strategies - The primary strategy employed by these bots is not to predict market direction but to exploit timing discrepancies where Polymarket prices lag behind confirmed spot momentum on major exchanges [3] - By entering trades when the actual probability is around 85% while the market shows 50/50 odds, these bots consistently buy mispriced contracts, leading to thousands of micro-trades that yield steady gains [3][5] Group 3: Market Dynamics - The automated systems take advantage of mispriced contracts, thin liquidity, and market lag, achieving a level of consistency that human traders cannot match [1]