How to Build a Polymarket Passive Income Bot from Scratch
Polymarket, a leading prediction market platform on Polygon, allows users to bet on real-world events using USDC. Its open API, transparent order book, low fees, and numerous human traders making errors create a fertile ground for automated trading bots. This article breaks down bot strategies from basic to advanced.
Beginner-level bots include airdrop farming bots that generate volume by repeatedly buying and selling the same position, and volatility捕捉 bots that bet on mean reversion after sharp price swings.
Intermediate strategies involve market-making bots, which profit from bid-ask spreads and liquidity rewards by placing limit orders, though they require significant capital and risk losses during sudden market moves.
Advanced bots include arbitrage bots that exploit pricing inefficiencies between related outcomes (e.g., YES/NO shares summing under 100%), and AI-powered bots that integrate multiple data sources—historical prices, news, on-chain activity, social sentiment—to identify mispriced probabilities and execute trades across hundreds of markets.
All bots require access to Polymarket’s API, a Polygon wallet for USDC transactions, historical data storage (e.g., PostgreSQL), and a Python-based toolchain. Bots succeed due to their speed, discipline, scalability, and data-processing capabilities. However, effective risk management is crucial, as strategies can fail due to liquidity issues, unexpected news, or intense competition. Building a profitable AI bot is particularly resource-intensive, akin to running a startup.
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