BTC/ETH Cross-Market Arbitrage on Polymarket

How It Works Polymarket hosts markets asking whether BTC or ETH will close above or below specific price levels. These markets should reflect the risk-neutral probability derived from options markets or quantitative models. When Polymarket prices diverge from model-implied probabilities (derived from spot prices, volatility, and time to resolution), an arbitrage or directional trade can be constructed.

Entry / Exit Conditions The dashboard monitors live Polymarket prices alongside BTC/ETH spot data. Entry conditions are inferred to involve a divergence threshold between model-implied and market-quoted probabilities. Exit is at resolution or convergence.

Verified Results The repository is described as a live dashboard, implying active use. No verified PnL or back-test statistics are disclosed.

Implementation Notes A dashboard-first approach allows visual monitoring and manual override, which is appropriate for a strategy where automated execution carries higher risk. The system appears to focus on signal generation rather than full automation.

Risks Options-implied probabilities and prediction market probabilities can diverge persistently due to different user bases and liquidity. The strategy requires accurate real-time data feeds and a robust probability model. Resolution rules on Polymarket (e.g., which price source, which timestamp) may differ from standard derivatives conventions, creating basis risk.