# Polymarket International Trading volume Methodology

## 1. Overview

The total value of trades executed on a decentralized spot exchange is measured by trading volume. Since trading fees are paid by users on their trades, this metric is correlated with the ability of the decentralized exchange project to generate fees and revenue. For Polymarket International, prediction market trades executed across both automated market maker (AMM) and order book mechanisms are captured by this metric. Overall activity, liquidity, and user engagement within the platform's prediction markets are reflected by this metric. Through the analysis of trading volume, the platform's capacity to generate fees and its overall market share in the decentralized prediction markets sector are evaluated.

## 2. Data sources

- **Blockchain events**: `FPMMBuy` and `FPMMSell` events from `FixedProductMarketMaker` contracts, and `OrdersMatched` events from `Exchange` and `NegRiskCtfExchange` contracts, covering Polygon
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Automated Market Maker (AMM) trade extraction

- **Purpose**: The capture of trading volume executed through the V1 automated market maker
- **Logic**: `FPMMBuy` and `FPMMSell` events are parsed from `FixedProductMarketMaker` contracts on Polygon. For buy events, the investment amount is extracted. For sell events, the return amount is extracted. These amounts are used to represent the trade value in the collateral asset. Only events occurring before the deprecation date are included.
- **Key fields**: `investmentAmount`, `returnAmount`, `token_address`

### Component B: Order book trade extraction

- **Purpose**: The capture of trading volume executed through the V1 and V2 order book matching engines
- **Logic**: `OrdersMatched` events are parsed from `Exchange` and `NegRiskCtfExchange` contracts across V1 and V2. For V1, the trade amount is determined by checking the maker and taker asset identifiers; if the maker asset identifier is zero, the maker amount filled is used, and if the taker asset identifier is zero, the taker amount filled is used. For V2, the trade amount is determined by the trade side; if the side is zero, the maker amount filled is used, and if the side is one, the taker amount filled is used.
- **Key fields**: `makerAmountFilled`, `takerAmountFilled`, `makerAssetId`, `takerAssetId`, `side`, `token_address`

### Component C: Decimal normalization and USD conversion

- **Purpose**: The normalization of trade amounts by asset decimals and conversion of the values to USD
- **Logic**: The extracted trade amounts are normalized by the decimal precision of the underlying collateral assets using asset metadata. The normalized amounts are then multiplied by the end-of-day prices of the respective assets to determine the USD-denominated trading volume.
- **Key fields**: `amount`, `token_address`

### Component D: Aggregation and product assignment

- **Purpose**: The aggregation of daily trading volume and assignment to the Polymarket International product
- **Logic**: The USD-denominated trading volumes from both the AMM and order book components are aggregated by day. The aggregated volume is assigned to the Polymarket International product. Daily boundaries are defined using UTC timestamps, and days with no trading activity are filled with zeros.
- **Key fields**: `timestamp`, `trading_volume`, `product_id`

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Total value of spot trades executed on the exchange.

Trading volume

Prediction markets

Liquidity providers deposit funds into Polymarket and receive trading fees from traders (supply-side fees). Polymarket has also launched a new peer-to-peer order book with no liquidity providers involved.

Polymarket is a non-custodial prediction market protocol built on Polygon. Polymarket was founded by Shayne Coplan and launched in 2020.

Polymarket team & investors own and govern the protocol. They do not currently take a cut of the total trading fees paid by traders (revenue). Polymarket's investors include Polychain, 1Confirmation, ParaFi Capital, etc.

Polymarket International

Trading volume

Trading volume

Chain breakdown