Polymarket Teams Up with Circle to Embrace Native USDC: Prediction Market Settlement Enters the "Pure USD" Era

On February 4, 2026, the world’s leading prediction market platform Polymarket announced a strategic partnership with internet finance platform Circle. The core of this partnership is that Polymarket will, within the next few months, fully migrate its platform settlement infrastructure from the current bridging USDC (USDC.e) on Polygon to the native USDC issued and redeemed directly by Circle.

This is not just a simple change of technology stack but a sign that the rapidly growing on-chain prediction markets are actively embracing more transparent, safer, and institution-grade settlement solutions that meet traditional financial standards.

Core of the Partnership: Why Shift from “Bridged” to “Native”?

The key to this cooperation lies in a complete upgrade of the settlement infrastructure. To understand its importance, first clarify the fundamental difference between “bridged stablecoins” and “native stablecoins.”

Currently, Polymarket uses bridged USDC (commonly called USDC.e) on its main platform on Polygon. The process of generating this token involves locking native USDC on the source chain such as Ethereum, then using a third-party cross-chain bridge protocol to “map” the corresponding token on Polygon.

Cross-chain bridge protocols are middleware that enable asset transfer between different blockchains but introduce additional complexity and risk points. These bridge protocols have become one of the most exploited infrastructure vulnerabilities in the crypto ecosystem.

In contrast, native USDC is issued directly by Circle’s regulated subsidiary and is promised to be redeemable 1:1 for USD. It does not rely on any intermediary bridging contracts, and its value and credit are fully backed by Circle and its full USD reserves.

The table below clearly compares the key differences between the two models:

Polymarket founder and CEO Shayne Coplan stated that adopting native USDC is to support a consistent USD-denominated settlement standard, thereby enhancing the integrity and reliability of the market as participation continues to grow.

Market Impact: Laying a Foundation for Billion-Dollar Prediction Markets

This upgrade is not an isolated event but a necessary choice for Polymarket amid explosive growth in trading volume. Prediction markets have become one of the fastest-growing sectors in crypto. According to market data, Polymarket’s nominal trading volume in the first 11 months of 2025 exceeded $22 billion, a 57% year-over-year increase. Its growth momentum remained strong into early 2026, with January alone reaching $7.66 billion in trading volume.

The massive trading volume and capital scale make the security and efficiency of the settlement layer critical to the platform’s survival. Moving to native USDC directly removes counterparty risks and smart contract risks associated with bridged tokens.

From a broader perspective, this move aligns Polymarket’s settlement standards with those expected by mainstream financial institutions. As global regulators tighten scrutiny of crypto prediction markets, adopting transparent, well-reserved stablecoin infrastructure like USDC provides a stronger compliance foundation to support expansion into mainstream finance.

Circle co-founder, Chairman, and CEO Jeremy Allaire commented that Polymarket is at the forefront of innovation, combining information speed with market speed. This partnership will bring the utility and speed of USDC to Polymarket users, delivering the best experience.

Industry Wave: Prediction Markets Going Mainstream, Standardized Settlement Becomes Key

The collaboration between Polymarket and Circle is a microcosm of the broader trend in the crypto industry. Many top institutions have reached a consensus that prediction markets will become mainstream by 2026.

Analysts predict that platforms like Polymarket will maintain weekly trading volumes of $1 billion to $1.5 billion or more. This sector has attracted many giants: Gemini launched Gemini Predictions, Coinbase announced a partnership with Kalshi, and Crypto.com launched its own prediction platform OG.

Traditional players such as retail broker Robinhood and sports betting platform DraftKings also entered the scene in 2025. In an increasingly competitive environment, infrastructure robustness has become a core differentiator.

Polymarket’s cooperation with Circle, a company defining modern, regulated, high-integrity market standards, indicates a long-term, institutional approach to building. The migration toward native, institutional-grade stablecoin settlement has become a trend since 2025, with public chains like Aptos also undergoing similar upgrades to improve liquidity.

Focus on USDC: Market Position and Gate Market Observation

This partnership further consolidates USDC’s position as the leading settlement asset. Industry data shows USDC is currently the second-largest stablecoin by market cap after Tether (USDT), with approximately $70.77 billion. Its design goal is to maintain a 1:1 peg with the US dollar.

On the Gate exchange platform, USDC consistently demonstrates excellent price stability. Its price fluctuations are usually confined within a very narrow range (e.g., between $1.0005 and $1.0011), fully aligning with its role as a value measure and medium of exchange rather than a speculative asset.

Although stablecoins are not meant to appreciate in price, expanding use cases directly drive demand and circulation. Recent analyst upgrades of Circle’s stock rating by Mizuho Securities pointed out that Polymarket’s strong growth is a core driver, as all transactions on the platform are settled in USDC.

They expect that as Polymarket continues to expand, it could contribute billions of USDC in incremental market cap over the next 1-2 years. This means the value of the partnership lies not in influencing USDC’s price but in significantly enhancing its utility and adoption as the “digital dollar” in the crypto world.

For traders seeking asset stability or looking for safe havens amid market volatility, USDC offers a reliable choice. Investors can use it as a stable cornerstone in their portfolios, for risk hedging, or as a starting point for participating in DeFi and yield-generating activities.

As Polymarket’s monthly trading volume surpassed $7.6 billion in January 2026, the urgency of this technological upgrade is evident. The migration from bridged tokens to native USDC means each transaction’s collateral is directly backed by Circle’s credit. This silent upgrade removes a potential systemic risk point. It’s not just about the safety of one platform but signals that the entire on-chain finance ecosystem, in pursuit of growth, is turning its focus toward more fundamental stability.

Prediction markets capture the probabilities of future events, and their settlement layer is quietly anchoring a more certain present.