Polymarket-based DeFi startup Gondor has launched what it describes as the first cross-margin account for Polymarket, the largest fully blockchain-based prediction market.
Announced via X on Monday, Gondor v1 allows users to use their entire Polymarket portfolio as collateral to borrow credit, which can then be used to purchase additional shares. This marks a major upgrade from Gondor’s beta product—released seven months ago—which only supported borrowing against individual positions.
Traditional prediction markets like Polymarket and Kalshi operate on a fully collateralized model, requiring users to lock up the full amount of capital at risk until an event resolves. Gondor’s initial offering introduced limited leverage by enabling loans against single positions, freeing up capital without forcing users to sell.
However, during its beta phase, Gondor identified critical limitations with isolated leverage. "As we tested the system, it became clear that the consequences went beyond interest rates," the team wrote. "To remain sustainable, isolated leverage had to be limited to a small set of highly liquid markets, exposure had to be capped, and many positions could not support borrowing at all."
The startup concluded that isolated margin systems force a trade-off: "You either protect lenders or give borrowers good UX, but not both." The safer the system for lenders, the more restrictive and costly it becomes for borrowers.
Cross-margining addresses these issues by evaluating the health of a user’s entire portfolio rather than individual positions—similar to how traditional prime brokers extend credit based on diversified client holdings. According to Gondor, this approach enables safer, lower-cost borrowing, supports a broader range of markets, allows positions to be held through resolution, and scales efficiently for both lenders and borrowers.
Gondor v1 will enter a private testing phase next week and is scheduled for public launch in September. Users will deposit their Polymarket shares into a unified, non-custodial margin account to receive a cash-like credit line usable directly on the platform.
The move comes amid growing regulatory and institutional interest in prediction markets. The U.S. Commodity Futures Trading Commission (CFTC) has recognized them as an innovative derivatives category that enhances price discovery and information aggregation, despite opposition from some state regulators.
Gondor is not alone in exploring margin for prediction markets. Earlier this year, Backpack Exchange—founded by former FTX employees—launched a private beta of its “Unified Prediction Portfolio” featuring cross-margin capabilities for select traders.
Backed by Prelude, Maven 11, and Castle Island Ventures, Gondor raised a $2.5 million seed round. Its beta attracted over 150,000 waitlist sign-ups.
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