GM and happy Friday!

Today we look at Polymarket's upcoming move into perps and what it could mean for its infrastructure stack, including its current relationship with Polygon. We cover the trade-offs, the alternatives on the table, and what's at stake for both sides. 

Crypto markets this week were broadly risk-off, with miners one of the standouts as improving hash price lifted the sector.

This week was broadly risk-off across crypto with narrow pockets of green. Memes led at 20.1%, with crypto miners (7.4%) and privacy (6.7%) the only other clear standouts, while BTC held up at 4.1%. Most sectors bled: the Ethereum ecosystem, lending, and modular all posted double-digit losses, and crypto equities lagged at -6.9% even as miners decoupled higher.

Miner outperformance traces to a structural improvement in mining economics. Network hashrate has pulled back from its ~1,150 EH/s peak in late October to around 950 EH/s. Coupled with higher BTC prices, hashprice moved up materially, climbing from a ~$28 trough in late February to $36 per PH/s on April 23, the highest print since late January.

The AI and high-performance computing (HPC) pivot narrative compounded the bid, with most public miners now marketing infrastructure buildouts rather than pure mining exposure.

Inside the miner index, ARBK led decisively at 31.1%, more than triple the next-best name. The rest of the pack clustered in the high single digits to low double digits with SOS, IREN, CIFR, HUT, and HIVE all in that zone; MARA traded essentially flat, and BTDR and GREE were the clear laggards.

Argo Blockchain plc (ARBK) rallied this week around its financial result release, with investors leaning into the post-restructuring HPC optionality rather than a clear new fundamental inflection. The key setup remains Argo's March facility, which provided an initial $2.5M and explicitly funds evaluation of HPC/AI data center opportunities, layered on top of the Baie-Comeau 23 MW conversion narrative.

— Sam

The Next Phase for Polymarket

This week Polymarket announced the upcoming launch of perps, after Kalshi revealed plans to introduce perpetual futures tied to crypto prices, with ambitions to expand into commodities and other asset classes. Polymarket’s launch teaser suggests a similar direction, marking a clear shift for both platforms as they move beyond event-based contracts into the much larger derivatives market opportunity. Whether this extends into event-driven perps across categories like politics and sports remains to be seen, but the intent is clear.

This shift raises an important question around infrastructure. Polymarket’s current design and its reliance on Polygon may not be well suited for high-frequency, latency-sensitive markets like perps. One path forward could be launching its own chain to better compete with vertically integrated systems like Hyperliquid. Alternatively, building a frontend on top of existing perp infrastructure would introduce further value leakage, adding to the existing dependence on Polygon. Capturing more of this value will be critical not just to justify its $15B valuation but to deliver a competitive trading experience.

Today, Polymarket operates a hybrid system where order matching and user interaction happen offchain, while execution and settlement occur onchain via Polygon. This works well for longer-duration prediction markets but introduces delays and uncertainty between order placement and final settlement. For market makers, this creates execution risk, particularly around cancellations and adverse selection.

These limitations become more pronounced with perps. Unlike event markets, perpetuals require fast feedback loops, tight execution, and real-time updates for funding, liquidations, and position management. While Polymarket controls parts of the trading stack, its reliance on an external chain for execution creates a bottleneck that could hinder performance at scale.

In contrast, systems like HyperCore integrate matching, execution, and state transitions within a single environment, offering deterministic execution and tighter control over latency. To compete at this level, Polymarket would likely need to internalize more of its stack, pointing toward an application-specific chain where it can control sequencing, reduce latency, and capture more of the economic value.

This has direct implications for Polygon. Polymarket is estimated to account for nearly 50% of Polygon’s transactions and around 65% of its network fees, making it one of the chain’s most important applications. As Polymarket expands into perps, the incentive to internalize these flows only increases, especially with new revenue streams like liquidations and MEV fees coming into play.

From Polygon’s perspective, a potential migration would represent a significant loss of activity and fee generation. The asymmetry is clear. Polymarket has alternatives and growing leverage, while Polygon remains heavily dependent on a single application for a meaningful share of its usage.

An alternative path would be for Polymarket to remain within the Polygon ecosystem while leveraging its Chain Development Kit (CDK) to launch a dedicated application-specific chain. This would allow Polymarket to control sequencing, execution, and fee capture, while still benefiting from shared liquidity and interoperability through AggLayer. In this model, Polygon retains the relationship, while Polymarket captures many of the advantages of full stack ownership without fully migrating away.

— Kunal

1. Western Union: Mispriced Distribution in a Stablecoin World

The report finds that Western Union is being mispriced as a declining legacy remittance business despite strong cash flow and a large global distribution network, with the market assigning little value to its potential stablecoin-driven transformation. The core thesis is that incumbents with distribution are best positioned to benefit from stablecoins, as WU can integrate them into its existing rails to improve settlement speed, unlock working capital, and generate reserve income while maintaining its customer base. The upside depends on execution, particularly scaling digital segments and successfully deploying USDPT, but the setup is asymmetric, with the downside supported by yield and cash flows and the upside driven by even a modest re-rating if growth stabilizes. 

2. Building the truth machine

The report argues that prediction markets have strong potential to act as “truth machines” by aggregating information into real-time probabilities, but current political markets fall far short due to low liquidity, fragmented listings, and weak incentives for participation. While markets show reasonable accuracy, especially in elections, most high-value policy questions are either illiquid, manipulable, or not listed at all, limiting their usefulness. The path forward depends on seeding liquidity, standardizing contracts, integrating AI agents, and attracting real-world hedging demand, positioning prediction markets not just as trading venues but as public information infrastructure. 

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