Prediction market arbitrage is free money.
I tried it for a month and it worked pretty well, but thereâs a lot you need to know.
Itâs not hard, it just takes time and focus. đ§”đœ
For those whoâve been following me in 2022/2023, you know I spent a long time profiting from arbitrage opportunities between CEXs and DEXs, or just between DEXs.
To be honest, DEX arbitrage has become so complex lately that itâs way beyond my comfort zone now haha.
But there are still fresh arbitrage opportunities in new markets like prediction markets.
Itâs still an emerging market with lots of different players, plenty of volatility, and advanced bots havenât fully taken over yet.
So itâs perfect for manual arbitrage.
The prediction market scene is basically dominated by three big players.
You know @Polymarket, but thereâs also @trylimitless and @Kalshi.
Polymarket has the highest volume and open interest, but Kalshi actually offers more markets and has been growing fast since its launch.
If you spend some time exploring these prediction markets, youâll find arbitrage opportunities.
The idea is simple: look for price gaps between different platforms.
You âbuy Yesâ on one market at price X and âbuy Noâ on another market at price Y. If X + Y is less than 1, you lock in a profit.
In five minutes of searching, I found this example: an arbitrage between Polymarket and Limitless on the âNegative GDP growth in Q2 2025â market.
On Limitless, the âYesâ is priced at $0.039 and the âNoâ at $0.97. On Polymarket, the âYesâ is $0.047 and the âNoâ is $0.95.
To capture the arbitrage, you buy the cheapest âYesâ and the cheapest âNoâ, so youâd buy the âYesâ on Limitless and the âNoâ on Polymarket.
0.039 + 0.95 = 0.989, which is under 1.
So thereâs an arbitrage spread.
The net profit for this example is about 1%.
So if you bet $10K, you lock in $100 profit.
It only took me a few minutes to find this while writing this thread, if you dig deeper, you can easily find higher yields.
Also, you donât have to wait for the market to settle to make profit.
If the spread is tight, you can buy a âYesâ on Limitless at $0.039 and flip it on Polymarket at $0.042, thatâs an instant 7% gain.
To save time, you can use tools like polymarketanalytics(dot)com.
For each bet, it shows you all the markets offering that bet and the current prices.
Itâs way faster than switching between tabs manually.
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