Polymarket Unveils USD Token in Major Platform Upgrade

• Polymarket replaces USDC.e with a new USD token backed 1:1 by USDC, improving speed and reducing costs.

• CTF Exchange V2 introduces optimized order matching, better fees, and smart contract wallet support.

• Upgrade comes amid regulatory pressure, with speculation growing around a potential POLY token launch.

Polymarket announced a major platform overhaul this week, introducing a new collateral token called Polymarket USD and replacing USDC.e across its system. The upgrade, expected within two to three weeks, includes new contracts and order books, as the platform seeks faster execution and lower costs while expanding amid rising regulatory scrutiny.

Transition to New Collateral Token Begins

According to Polymarket, the new token will be backed 1:1 by Circle’s USDC. The migration from USDC.e will occur gradually over the coming weeks. For most users, the process remains automated through the platform interface.

However, advanced users and API traders must manually convert assets. They will use the Collateral Onramp contract’s wrap() function to complete the transition. This shift forms part of a broader system redesign.

Polymarket described the update as its largest infrastructure change since launch. The company stated the upgrade will improve execution speed and reduce gas costs across transactions.

Exchange Upgrade Introduces New Architecture

Alongside the token rollout, Polymarket introduced the CTF Exchange V2. This new contract replaces its previous exchange framework with optimized order handling. Notably, the system simplifies order structures and improves matching efficiency.

Additionally, the upgrade includes builder codes for on-chain attribution. Fee collection and distribution mechanisms also receive improvements. The platform confirmed support for EIP-1271, enabling secure authentication for smart contract wallets.

Meanwhile, the order book system will automatically migrate users from version one to version two. However, developers must update to the latest client versions to ensure compatibility.

Regulatory Backdrop and Future Signals

The upgrade arrives as prediction markets face increasing regulatory pressure. State regulators have raised concerns over unlicensed betting activities tied to such platforms. However, the Commodity Futures Trading Commission recently asserted federal jurisdiction in related legal disputes.

At the same time, Polymarket’s infrastructure changes have fueled speculation about a potential native token. Earlier this year, the company filed trademarks for “POLY” and “$POLY,” covering crypto trading and token services.

These filings, combined with the current upgrade, highlight ongoing structural changes within the platform as it adapts to growing demand and growing oversight.