The prices probabilities displayed on Polymarket are the midpoint of the bid-ask spread in the orderbook.
When a market is created, there are initially zero shares and no pre-defined prices or odds.
Market makers (a fancy term for traders placing limit orders) interested in buying YES or NO shares can place Limit Orders at the price they’re willing to pay
When offers for the YES and NO side equal $1.00, the order is “matched” and that $1.00 is converted into 1 YES and 1 NO share, each going to their respective buyers.
For example, if you place a limit order at $0.60 for YES, that order is matched when someone places a NO order at $0.40. This becomes the initial market price.
The prices displayed on Polymarket are the midpoint of the bid-ask spread in the orderbook — unless that spread is over $0.10, in which case the last traded price is used.
Like the stock market, prices on Polymarket are a function of realtime supply & demand.
In the market below, the probability of 37% is the midpoint between the 34¢ bid and 40¢ ask. If the bid-ask spread is wider than 10¢, the probability is shown as the last traded price.