Build a prediction market trading app with Polymarket

What We’re Building

A React (Next.js) app that connects Dynamic’s embedded wallets to Polymarket prediction markets, allowing users to:

Browse active prediction markets with real-time prices
Buy Yes/No outcome shares on markets
View and manage portfolio positions
Sell positions and redeem winning outcomes
Deposit funds via multiple methods (QR, credit card, cross-chain)

If you want to take a quick look at the final code, check out the GitHub repository.

Key Components

Dynamic Embedded Wallets - Non-custodial wallets with seamless auth
Polymarket CLOB Client - Trading SDK for placing orders on Polymarket
Polygon Network - All trades execute on Polygon mainnet

Building the Application

Project Setup

Start by creating a new Dynamic project with React, Viem, Wagmi, and Ethereum support:

npx create-dynamic-app@latest polymarket-app --framework nextjs --library viem --wagmi true --chains ethereum --pm npm
cd polymarket-app

Install Dependencies

Add the Polymarket CLOB client and other required dependencies:

npm install @polymarket/clob-client ethers@^5.8.0 @tanstack/react-query motion lucide-react

The @polymarket/clob-client provides the SDK for interacting with Polymarket’s Central Limit Order Book (CLOB) for placing and managing orders.

Configure Environment

Create a .env.local file with your Dynamic environment ID:

.env.local

NEXT_PUBLIC_DYNAMIC_ENV_ID=your-environment-id-here

You can find your Environment ID in the Dynamic dashboard under Developer Settings → SDK & API Keys.

Configure Wagmi for Polygon

Since Polymarket operates on Polygon, configure Wagmi to use Polygon mainnet. Create src/lib/wagmi.ts:

src/lib/wagmi.ts

import { createConfig, http } from "wagmi";
import { polygon } from "wagmi/chains";

export const config = createConfig({
  chains: [polygon],
  connectors: [],
  transports: {
    [polygon.id]: http(),
  },
  multiInjectedProviderDiscovery: false,
});

declare module "wagmi" {
  interface Register {
    config: typeof config;
  }
}

Configure Providers

Set up the providers with Dynamic, Wagmi, and React Query. Create src/lib/providers.tsx:

src/lib/providers.tsx

"use client";

import { useState, useEffect, useRef } from "react";
import { config } from "@/lib/wagmi";
import {
  DynamicContextProvider,
  DynamicUserProfile,
  EthereumWalletConnectors,
  useDynamicContext,
  useSwitchNetwork,
  isEthereumWallet,
} from "@dynamic-labs/sdk-react-core";
import { DynamicWagmiConnector } from "@dynamic-labs/wagmi-connector";
import { QueryClient, QueryClientProvider } from "@tanstack/react-query";
import { WagmiProvider } from "wagmi";

const POLYGON_CHAIN_ID = 137;

function NetworkSwitcher() {
  const { primaryWallet } = useDynamicContext();
  const switchNetwork = useSwitchNetwork();
  const hasSwitchedRef = useRef(false);

  useEffect(() => {
    if (!primaryWallet) {
      hasSwitchedRef.current = false;
      return;
    }

    if (!isEthereumWallet(primaryWallet)) {
      return;
    }

    const switchToPolygon = async () => {
      if (hasSwitchedRef.current) return;

      try {
        const walletClient = await primaryWallet.getWalletClient();
        const currentChainId = await walletClient.getChainId();

        if (currentChainId !== POLYGON_CHAIN_ID) {
          await switchNetwork({
            wallet: primaryWallet,
            network: POLYGON_CHAIN_ID,
          });
        }
        hasSwitchedRef.current = true;
      } catch {
        // Network switch failed
      }
    };

    const timeoutId = setTimeout(switchToPolygon, 500);
    return () => clearTimeout(timeoutId);
  }, [primaryWallet, switchNetwork]);

  return null;
}

export default function Providers({ children }: { children: React.ReactNode }) {
  const [queryClient] = useState(() => new QueryClient());

  return (
    <DynamicContextProvider
      theme="dark"
      settings={{
        environmentId: process.env.NEXT_PUBLIC_DYNAMIC_ENV_ID!,
        walletConnectors: [EthereumWalletConnectors],
      }}
    >
      <WagmiProvider config={config}>
        <QueryClientProvider client={queryClient}>
          <DynamicWagmiConnector>
            <NetworkSwitcher />
            {children}
            <DynamicUserProfile />
          </DynamicWagmiConnector>
        </QueryClientProvider>
      </WagmiProvider>
    </DynamicContextProvider>
  );
}

The NetworkSwitcher component automatically switches the user’s wallet to Polygon when they connect, ensuring they’re on the correct network for Polymarket.

Define Contract Constants

Create src/lib/constants/contracts.ts for Polymarket contract addresses:

src/lib/constants/contracts.ts

export const POLYMARKET_CONTRACTS = {
  USDC_E: "0x2791Bca1f2de4661ED88A30C99A7a9449Aa84174" as const,
  CTF: "0x4d97dcd97ec945f40cf65f87097ace5ea0476045" as const,
  CTF_EXCHANGE: "0x4bFb41d5B3570DeFd03C39a9A4D8dE6Bd8B8982E" as const,
  NEG_RISK_CTF_EXCHANGE: "0xC5d563A36AE78145C45a50134d48A1215220f80a" as const,
  NEG_RISK_ADAPTER: "0xd91E80cF2E7be2e162c6513ceD06f1dD0dA35296" as const,
};

export const POLYMARKET_USDC_SPENDERS = [
  { address: POLYMARKET_CONTRACTS.CTF_EXCHANGE, name: "Main Exchange" },
  { address: POLYMARKET_CONTRACTS.NEG_RISK_CTF_EXCHANGE, name: "Neg Risk Markets" },
  { address: POLYMARKET_CONTRACTS.NEG_RISK_ADAPTER, name: "Neg Risk Adapter" },
] as const;

export const POLYMARKET_OUTCOME_TOKEN_SPENDERS = [
  { address: POLYMARKET_CONTRACTS.CTF_EXCHANGE, name: "Main Exchange" },
  { address: POLYMARKET_CONTRACTS.NEG_RISK_CTF_EXCHANGE, name: "Neg Risk Markets" },
  { address: POLYMARKET_CONTRACTS.NEG_RISK_ADAPTER, name: "Neg Risk Adapter" },
] as const;

export const ERC20_APPROVAL_ABI = [
  {
    inputs: [
      { name: "owner", type: "address" },
      { name: "spender", type: "address" },
    ],
    name: "allowance",
    outputs: [{ name: "", type: "uint256" }],
    stateMutability: "view",
    type: "function",
  },
  {
    inputs: [
      { name: "spender", type: "address" },
      { name: "amount", type: "uint256" },
    ],
    name: "approve",
    outputs: [{ name: "", type: "bool" }],
    stateMutability: "nonpayable",
    type: "function",
  },
  {
    inputs: [{ name: "account", type: "address" }],
    name: "balanceOf",
    outputs: [{ name: "", type: "uint256" }],
    stateMutability: "view",
    type: "function",
  },
] as const;

export const ERC1155_APPROVAL_ABI = [
  {
    inputs: [
      { name: "operator", type: "address" },
      { name: "approved", type: "bool" },
    ],
    name: "setApprovalForAll",
    outputs: [],
    stateMutability: "nonpayable",
    type: "function",
  },
  {
    inputs: [
      { name: "account", type: "address" },
      { name: "operator", type: "address" },
    ],
    name: "isApprovedForAll",
    outputs: [{ name: "", type: "bool" }],
    stateMutability: "view",
    type: "function",
  },
] as const;

Create Markets API Route

Create an API route to fetch markets from Polymarket. Create src/app/api/polymarket/route.ts:

src/app/api/polymarket/route.ts

import { NextResponse } from "next/server";

interface PolymarketMarket {
  id: string;
  question: string;
  conditionId: string;
  slug: string;
  endDate: string;
  category: string;
  image?: string;
  icon?: string;
  outcomes?: string;
  outcomePrices?: string;
  volume?: string;
  volumeNum?: number;
  active?: boolean;
  closed?: boolean;
  clobTokenIds?: string;
}

interface TransformedMarket {
  id: string;
  question: string;
  endDate: string;
  yesPrice: string;
  noPrice: string;
  category: string;
  imageUrl: string;
  yesTraders: number;
  noTraders: number;
  conditionId: string;
  yesTokenId?: string;
  noTokenId?: string;
  tags: string[];
  volume: number;
}

function transformMarket(market: PolymarketMarket): TransformedMarket | null {
  try {
    let outcomes: string[] = ["Yes", "No"];
    let prices: string[] = ["0", "0"];

    if (market.outcomes) {
      try {
        outcomes = JSON.parse(market.outcomes) as string[];
      } catch {
        // Use defaults
      }
    }

    if (market.outcomePrices) {
      try {
        prices = JSON.parse(market.outcomePrices) as string[];
      } catch {
        // Use defaults
      }
    }

    // Find Yes and No indices
    const lowerOutcomes = outcomes.map((o) => o.toLowerCase());
    const yesIndex = lowerOutcomes.findIndex(
      (o) => o.includes("yes") || o === "true"
    );
    const noIndex = lowerOutcomes.findIndex(
      (o) => o.includes("no") || o === "false"
    );

    const finalYesIndex = yesIndex >= 0 ? yesIndex : 0;
    const finalNoIndex = noIndex >= 0 ? noIndex : 1;

    // Parse and normalize prices to 0-100 range
    let yesPriceNum = parseFloat(prices[finalYesIndex] || "0");
    let noPriceNum = parseFloat(prices[finalNoIndex] || "0");

    const priceSum = yesPriceNum + noPriceNum;
    if (priceSum <= 1.5 && priceSum > 0) {
      yesPriceNum *= 100;
      noPriceNum *= 100;
    }

    // Normalize to sum to 100
    const total = yesPriceNum + noPriceNum;
    if (total > 0) {
      const factor = 100 / total;
      yesPriceNum *= factor;
      noPriceNum *= factor;
    } else {
      yesPriceNum = 50;
      noPriceNum = 50;
    }

    const yesPrice = Math.max(0, Math.min(100, yesPriceNum)).toFixed(1);
    const noPrice = Math.max(0, Math.min(100, noPriceNum)).toFixed(1);

    // Parse token IDs
    let yesTokenId: string | undefined;
    let noTokenId: string | undefined;
    if (market.clobTokenIds) {
      try {
        const tokenIds = JSON.parse(market.clobTokenIds) as string[];
        if (tokenIds.length >= 2) {
          yesTokenId = tokenIds[finalYesIndex] || tokenIds[0];
          noTokenId = tokenIds[finalNoIndex] || tokenIds[1];
        }
      } catch {
        // Ignore parse errors
      }
    }

    const volume = market.volumeNum ?? (market.volume ? parseFloat(market.volume) : 0);
    const yesTraders = Math.floor(volume * 0.4);
    const noTraders = Math.floor(volume * 0.3);

    return {
      id: market.id,
      question: market.question,
      endDate: market.endDate,
      yesPrice,
      noPrice,
      category: market.category || "All",
      imageUrl: market.image || market.icon || "",
      yesTraders,
      noTraders,
      conditionId: market.conditionId,
      yesTokenId,
      noTokenId,
      tags: [],
      volume,
    };
  } catch {
    return null;
  }
}

export async function GET(request: Request) {
  try {
    const { searchParams } = new URL(request.url);
    const limit = searchParams.get("limit") || "100";

    const url = new URL("https://gamma-api.polymarket.com/markets");
    url.searchParams.set("limit", limit);
    url.searchParams.set("closed", "false");
    url.searchParams.set("active", "true");

    const response = await fetch(url.toString(), {
      method: "GET",
      headers: { Accept: "application/json" },
      next: { revalidate: 60 },
    });

    if (!response.ok) {
      throw new Error(`Polymarket API error: ${response.status}`);
    }

    const data = await response.json();
    const markets: PolymarketMarket[] = Array.isArray(data) ? data : [];

    const transformedMarkets = markets
      .map((market) => transformMarket(market))
      .filter((market): market is TransformedMarket => market !== null);

    return NextResponse.json(transformedMarkets);
  } catch (error) {
    const errorMessage = error instanceof Error ? error.message : "Unknown error";
    return NextResponse.json(
      { error: "Failed to fetch markets", details: errorMessage },
      { status: 500 }
    );
  }
}

Create Markets Hook

Create a hook to fetch and cache market data. Create src/lib/hooks/usePolymarketMarkets.ts:

src/lib/hooks/usePolymarketMarkets.ts

import { useQuery } from "@tanstack/react-query";

export interface Market {
  id: string;
  question: string;
  endDate: string;
  yesPrice: string;
  noPrice: string;
  category: string;
  imageUrl: string;
  yesTraders: number;
  noTraders: number;
  conditionId: string;
  yesTokenId?: string;
  noTokenId?: string;
  tags: string[];
  volume: number;
}

export function calculateTimeRemaining(endDate: string): string {
  try {
    const end = new Date(endDate).getTime();
    const now = Date.now();
    const diff = end - now;

    if (diff <= 0) return "Closed";

    const days = Math.floor(diff / 86400000);
    const hours = Math.floor((diff % 86400000) / 3600000);
    const minutes = Math.floor((diff % 3600000) / 60000);

    if (days > 0) return `${days}d ${hours}h ${minutes}m`;
    if (hours > 0) return `${hours}h ${minutes}m`;
    return `${minutes}m`;
  } catch {
    return "Unknown";
  }
}

async function fetchMarkets(): Promise<Market[]> {
  const response = await fetch("/api/polymarket?limit=100&active=true");
  if (!response.ok) {
    throw new Error("Failed to fetch markets");
  }
  return response.json();
}

export function usePolymarketMarkets() {
  return useQuery({
    queryKey: ["polymarket-markets"],
    queryFn: fetchMarkets,
    staleTime: 60000,
    refetchInterval: 60000,
  });
}

Create Trading Hook

Now let’s build the trading hook that handles placing orders. Create src/lib/hooks/usePolymarketTrading.ts:

src/lib/hooks/usePolymarketTrading.ts

"use client";

import { useState, useCallback, useRef } from "react";
import { useDynamicContext, isEthereumWallet } from "@dynamic-labs/sdk-react-core";
import { ClobClient, Side, OrderType } from "@polymarket/clob-client";
import type { UserMarketOrder } from "@polymarket/clob-client";
import { Contract, providers, BigNumber } from "ethers";
import {
  POLYMARKET_CONTRACTS,
  POLYMARKET_USDC_SPENDERS,
  POLYMARKET_OUTCOME_TOKEN_SPENDERS,
  ERC20_APPROVAL_ABI,
  ERC1155_APPROVAL_ABI,
} from "@/lib/constants/contracts";

const SIGNATURE_TYPE_EOA = 0;
const CLOB_API_URL = "https://clob.polymarket.com";
const POLYGON_CHAIN_ID = 137;
const MAX_ALLOWANCE = BigNumber.from(
  "0xffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffff"
);
const MIN_ALLOWANCE_THRESHOLD = BigNumber.from("1000000000000");

export interface UserApiCredentials {
  key: string;
  secret: string;
  passphrase: string;
}

export interface TradeParams {
  marketId: string;
  conditionId: string;
  tokenId: string;
  side: "yes" | "no";
  amount: number;
  isMarketOrder?: boolean;
  negRisk?: boolean;
}

export function usePolymarketTrading() {
  const { primaryWallet } = useDynamicContext();

  const [isLoading, setIsLoading] = useState(false);
  const [error, setError] = useState<string | null>(null);

  const credentialsRef = useRef<UserApiCredentials | null>(null);
  const signerRef = useRef<providers.JsonRpcSigner | null>(null);

  const address = primaryWallet?.address;

  const getEthersSigner = useCallback(async (): Promise<providers.JsonRpcSigner | null> => {
    if (!primaryWallet || !isEthereumWallet(primaryWallet)) {
      return null;
    }

    if (signerRef.current) {
      return signerRef.current;
    }

    try {
      const walletClient = await primaryWallet.getWalletClient();
      const provider = new providers.Web3Provider(walletClient);
      signerRef.current = provider.getSigner();
      return signerRef.current;
    } catch (err) {
      console.error("Failed to create ethers signer:", err);
      return null;
    }
  }, [primaryWallet]);

  const initializeCredentials = useCallback(async (): Promise<UserApiCredentials | null> => {
    const ethersSigner = await getEthersSigner();

    if (!ethersSigner || !address) {
      setError("Wallet not connected");
      return null;
    }

    if (credentialsRef.current) {
      return credentialsRef.current;
    }

    setIsLoading(true);
    setError(null);

    try {
      const tempClient = new ClobClient(
        CLOB_API_URL,
        POLYGON_CHAIN_ID,
        ethersSigner as any
      );

      let credentials: UserApiCredentials | null = null;

      try {
        const derivedCreds = await tempClient.deriveApiKey();
        if (derivedCreds?.key && derivedCreds?.secret && derivedCreds?.passphrase) {
          credentials = derivedCreds;
        }
      } catch {
        // Will create new credentials below
      }

      if (!credentials) {
        const newCreds = await tempClient.createApiKey();
        if (newCreds?.key && newCreds?.secret && newCreds?.passphrase) {
          credentials = newCreds;
        } else {
          throw new Error("Failed to create API credentials");
        }
      }

      credentialsRef.current = credentials;
      setIsLoading(false);
      return credentials;
    } catch (err) {
      const errorMessage = err instanceof Error ? err.message : "Failed to initialize credentials";
      setError(errorMessage);
      setIsLoading(false);
      return null;
    }
  }, [getEthersSigner, address]);

  const ensureApprovals = useCallback(async (
    signer: providers.JsonRpcSigner,
    requiredAmount: number
  ): Promise<{ approved: boolean; error?: string }> => {
    try {
      const signerAddress = await signer.getAddress();
      const usdcContract = new Contract(
        POLYMARKET_CONTRACTS.USDC_E,
        ERC20_APPROVAL_ABI,
        signer
      );

      // Check balance
      const balance: BigNumber = await usdcContract.balanceOf(signerAddress);
      const requiredBN = BigNumber.from(Math.ceil(requiredAmount * 1e6));

      if (balance.lt(requiredBN)) {
        const balanceFormatted = (Number(balance.toString()) / 1e6).toFixed(2);
        return {
          approved: false,
          error: `Insufficient USDC.e balance. You have ${balanceFormatted} USDC but need ${requiredAmount} USDC.`,
        };
      }

      // Approve USDC spenders
      for (const { address } of POLYMARKET_USDC_SPENDERS) {
        const currentAllowance: BigNumber = await usdcContract.allowance(signerAddress, address);
        if (currentAllowance.lt(MIN_ALLOWANCE_THRESHOLD)) {
          const approveTx = await usdcContract.approve(address, MAX_ALLOWANCE);
          await approveTx.wait();
        }
      }

      // Approve outcome token spenders
      const ctfContract = new Contract(
        POLYMARKET_CONTRACTS.CTF,
        ERC1155_APPROVAL_ABI,
        signer
      );

      for (const { address } of POLYMARKET_OUTCOME_TOKEN_SPENDERS) {
        const isApproved: boolean = await ctfContract.isApprovedForAll(signerAddress, address);
        if (!isApproved) {
          const approveTx = await ctfContract.setApprovalForAll(address, true);
          await approveTx.wait();
        }
      }

      return { approved: true };
    } catch (err) {
      const errorMessage = err instanceof Error ? err.message : "Failed to approve";
      return { approved: false, error: errorMessage };
    }
  }, []);

  const placeOrder = useCallback(async (
    params: TradeParams
  ): Promise<{ success: boolean; orderId?: string; error?: string }> => {
    if (!address) {
      return { success: false, error: "Wallet not connected" };
    }

    setIsLoading(true);
    setError(null);

    const ethersSigner = await getEthersSigner();
    if (!ethersSigner) {
      setIsLoading(false);
      return { success: false, error: "Failed to get wallet signer" };
    }

    const credentials = credentialsRef.current || (await initializeCredentials());
    if (!credentials) {
      setIsLoading(false);
      return { success: false, error: "Failed to initialize trading credentials" };
    }

    // Ensure approvals
    const approvalResult = await ensureApprovals(ethersSigner, params.amount);
    if (!approvalResult.approved) {
      setIsLoading(false);
      return { success: false, error: approvalResult.error };
    }

    try {
      const client = new ClobClient(
        CLOB_API_URL,
        POLYGON_CHAIN_ID,
        ethersSigner as any,
        credentials,
        SIGNATURE_TYPE_EOA
      );

      const marketOrder: UserMarketOrder = {
        tokenID: params.tokenId,
        amount: params.amount,
        side: Side.BUY,
        feeRateBps: 0,
      };

      const response = await client.createAndPostMarketOrder(
        marketOrder,
        { negRisk: params.negRisk },
        OrderType.FOK
      );

      const orderId = response.orderID || response.orderId || response.id;
      setIsLoading(false);

      if (orderId) {
        return { success: true, orderId };
      } else if (response.success || response.status === "success") {
        return { success: true, orderId: "pending" };
      } else {
        throw new Error(response.error || "Order submission failed");
      }
    } catch (err) {
      const errorMessage = err instanceof Error ? err.message : "Failed to place order";
      setError(errorMessage);
      setIsLoading(false);
      return { success: false, error: errorMessage };
    }
  }, [address, getEthersSigner, initializeCredentials, ensureApprovals]);

  return {
    placeOrder,
    initializeCredentials,
    isLoading,
    error,
  };
}

This hook handles:

Creating an ethers signer from Dynamic’s wallet client
Initializing Polymarket API credentials (required for trading)
Checking USDC balance and approving spender contracts
Placing market orders via the CLOB client

Create User Positions Hook

Create a hook to fetch user positions. Create src/lib/hooks/useUserPositions.ts:

src/lib/hooks/useUserPositions.ts

import { useQuery } from "@tanstack/react-query";

export interface PolymarketPosition {
  proxyWallet: string;
  asset: string;
  conditionId: string;
  size: number;
  avgPrice: number;
  initialValue: number;
  currentValue: number;
  cashPnl: number;
  percentPnl: number;
  curPrice: number;
  redeemable: boolean;
  title: string;
  outcome: string;
  outcomeIndex: number;
  negativeRisk: boolean;
}

async function fetchPositions(walletAddress: string): Promise<PolymarketPosition[]> {
  const params = new URLSearchParams({ user: walletAddress });
  const response = await fetch(`/api/polymarket/positions?${params}`);

  if (!response.ok) {
    throw new Error("Failed to fetch positions");
  }

  return response.json();
}

export function useUserPositions(walletAddress: string | undefined) {
  return useQuery({
    queryKey: ["polymarket-positions", walletAddress],
    queryFn: () => fetchPositions(walletAddress!),
    enabled: !!walletAddress,
    staleTime: 5000,
    refetchInterval: 10000,
  });
}

Build the Market Card Component

Create src/components/MarketCard.tsx for displaying individual markets:

src/components/MarketCard.tsx

import { useState, useCallback, useRef } from "react";
import { usePolymarketTrading } from "@/lib/hooks/usePolymarketTrading";
import { useDynamicContext } from "@dynamic-labs/sdk-react-core";
import { polygon } from "wagmi/chains";

interface MarketCardProps {
  question: string;
  timeRemaining: string;
  yesPrice: string;
  noPrice: string;
  conditionId?: string;
  yesTokenId?: string;
  noTokenId?: string;
  marketId?: string;
}

export function MarketCard({
  question,
  timeRemaining,
  yesPrice,
  noPrice,
  conditionId,
  yesTokenId,
  noTokenId,
  marketId,
}: MarketCardProps) {
  const [selectedOption, setSelectedOption] = useState<"yes" | "no" | null>(null);
  const [betAmount, setBetAmount] = useState<number>(0);
  const [isExpanded, setIsExpanded] = useState(false);
  const [tradingError, setTradingError] = useState<string | null>(null);
  const [tradingSuccess, setTradingSuccess] = useState(false);
  const [isProcessing, setIsProcessing] = useState(false);

  const { primaryWallet, setShowAuthFlow } = useDynamicContext();
  const { placeOrder } = usePolymarketTrading();

  const handleOptionClick = (option: "yes" | "no") => {
    if (!primaryWallet) {
      setShowAuthFlow(true);
      return;
    }

    setSelectedOption(option);
    setIsExpanded(true);
    setBetAmount(0);
    setTradingError(null);
    setTradingSuccess(false);
  };

  const handleBuy = useCallback(async () => {
    if (betAmount === 0 || !selectedOption || !primaryWallet) return;

    if (!conditionId || (!yesTokenId && !noTokenId)) {
      setTradingError("Market data incomplete");
      return;
    }

    setIsProcessing(true);
    setTradingError(null);

    try {
      // Ensure we're on Polygon
      const currentNetwork = await primaryWallet.getNetwork();
      if (currentNetwork !== polygon.id) {
        if (primaryWallet.connector.supportsNetworkSwitching()) {
          await primaryWallet.switchNetwork(polygon.id);
          await new Promise((resolve) => setTimeout(resolve, 2000));
        } else {
          setTradingError("Please switch to Polygon network");
          setIsProcessing(false);
          return;
        }
      }

      const tokenId = selectedOption === "yes" ? yesTokenId : noTokenId;
      if (!tokenId) {
        setTradingError("Token ID not available");
        setIsProcessing(false);
        return;
      }

      const result = await placeOrder({
        marketId: marketId || "",
        conditionId,
        tokenId,
        side: selectedOption,
        amount: betAmount,
        isMarketOrder: true,
      });

      if (result.success) {
        setTradingSuccess(true);
        setTimeout(() => {
          setIsExpanded(false);
          setSelectedOption(null);
        }, 2000);
      } else {
        setTradingError(result.error || "Failed to place order");
      }
    } catch (error) {
      setTradingError(error instanceof Error ? error.message : "An error occurred");
    } finally {
      setIsProcessing(false);
    }
  }, [betAmount, selectedOption, primaryWallet, conditionId, yesTokenId, noTokenId, marketId, placeOrder]);

  const potentialWin = betAmount > 0
    ? selectedOption === "yes"
      ? (betAmount / parseFloat(yesPrice)) * 100
      : (betAmount / parseFloat(noPrice)) * 100
    : 0;

  return (
    <div className="bg-[#141620] rounded-[22px] p-4 w-full">
      {/* Header */}
      <div className="mb-4">
        <p className="font-semibold text-white text-lg">{question}</p>
        <p className="text-gray-500 text-sm">{timeRemaining}</p>
      </div>

      {/* Yes/No Buttons */}
      <div className="flex gap-2">
        <button
          onClick={() => handleOptionClick("yes")}
          className={`flex-1 py-3 rounded-lg font-semibold transition-colors ${
            selectedOption === "yes"
              ? "bg-green-500 text-white"
              : "bg-green-500/10 text-green-500 hover:bg-green-500/20"
          }`}
        >
          Yes {yesPrice}¢
        </button>
        <button
          onClick={() => handleOptionClick("no")}
          className={`flex-1 py-3 rounded-lg font-semibold transition-colors ${
            selectedOption === "no"
              ? "bg-red-500 text-white"
              : "bg-red-500/10 text-red-500 hover:bg-red-500/20"
          }`}
        >
          No {noPrice}¢
        </button>
      </div>

      {/* Expanded Trading Section */}
      {isExpanded && (
        <div className="mt-4 space-y-3">
          {/* Amount Input */}
          <div className="bg-[#191b25] rounded-lg p-3">
            <input
              type="number"
              value={betAmount || ""}
              onChange={(e) => setBetAmount(parseFloat(e.target.value) || 0)}
              placeholder="Enter amount (USDC)"
              className="w-full bg-transparent text-white outline-none"
            />
          </div>

          {/* Quick Add Buttons */}
          <div className="flex gap-2">
            {[5, 10, 25].map((amount) => (
              <button
                key={amount}
                onClick={() => setBetAmount(betAmount + amount)}
                className="px-4 py-2 bg-gray-700/50 rounded-lg text-gray-400 hover:bg-gray-700"
              >
                +${amount}
              </button>
            ))}
          </div>

          {/* Error/Success Messages */}
          {tradingError && (
            <div className="bg-red-500/10 border border-red-500/30 rounded-lg p-3">
              <p className="text-red-500 text-sm">{tradingError}</p>
            </div>
          )}
          {tradingSuccess && (
            <div className="bg-green-500/10 border border-green-500/30 rounded-lg p-3">
              <p className="text-green-500 text-sm">Order placed successfully!</p>
            </div>
          )}

          {/* Buy Button */}
          <button
            onClick={handleBuy}
            disabled={betAmount === 0 || isProcessing}
            className={`w-full py-3 rounded-lg font-semibold transition-colors ${
              betAmount > 0 && !isProcessing
                ? "bg-blue-500 text-white hover:bg-blue-600"
                : "bg-gray-700 text-gray-500 cursor-not-allowed"
            }`}
          >
            {isProcessing ? "Processing..." : `Buy ${selectedOption === "yes" ? "Yes" : "No"}`}
            {betAmount > 0 && !isProcessing && (
              <span className="block text-sm opacity-70">
                To win ${potentialWin.toFixed(2)}
              </span>
            )}
          </button>
        </div>
      )}
    </div>
  );
}

Build the Main Page

Create the main page that displays markets. Update src/app/page.tsx:

src/app/page.tsx

"use client";

import { useMemo, useState } from "react";
import { MarketCard } from "@/components/MarketCard";
import {
  usePolymarketMarkets,
  type Market,
  calculateTimeRemaining,
} from "@/lib/hooks/usePolymarketMarkets";

export default function Home() {
  const [searchQuery, setSearchQuery] = useState("");
  const { data: markets = [], isLoading, error } = usePolymarketMarkets();

  const filteredMarkets = useMemo(() => {
    if (!markets.length) return [];

    const lowerSearchQuery = searchQuery.toLowerCase();

    return markets.filter((market: Market) => {
      if (lowerSearchQuery && !market.question.toLowerCase().includes(lowerSearchQuery)) {
        return false;
      }
      return true;
    });
  }, [markets, searchQuery]);

  return (
    <div className="min-h-screen bg-[#0e1219] p-6">
      {/* Header */}
      <div className="max-w-6xl mx-auto mb-8">
        <h1 className="text-3xl font-bold text-white mb-4">Prediction Markets</h1>
        
        {/* Search */}
        <input
          type="text"
          value={searchQuery}
          onChange={(e) => setSearchQuery(e.target.value)}
          placeholder="Search markets..."
          className="w-full max-w-md bg-[#191b25] text-white px-4 py-3 rounded-lg outline-none"
        />
      </div>

      {/* Markets Grid */}
      <div className="max-w-6xl mx-auto">
        {isLoading ? (
          <div className="text-center py-20">
            <p className="text-gray-500">Loading markets...</p>
          </div>
        ) : error ? (
          <div className="text-center py-20">
            <p className="text-gray-500">Error loading markets. Please try again.</p>
          </div>
        ) : filteredMarkets.length > 0 ? (
          <div className="grid grid-cols-1 md:grid-cols-2 lg:grid-cols-3 gap-5">
            {filteredMarkets.map((market: Market) => (
              <MarketCard
                key={market.id}
                question={market.question}
                timeRemaining={calculateTimeRemaining(market.endDate)}
                yesPrice={market.yesPrice}
                noPrice={market.noPrice}
                conditionId={market.conditionId}
                yesTokenId={market.yesTokenId}
                noTokenId={market.noTokenId}
                marketId={market.id}
              />
            ))}
          </div>
        ) : (
          <div className="text-center py-20">
            <p className="text-gray-500">No markets found</p>
          </div>
        )}
      </div>
    </div>
  );
}

Run the Application

Start the development server:

npm run dev

The application will be available at http://localhost:3000.

Configure CORS

Add your local development URL to the CORS origins in your Dynamic dashboard under Developer Settings > CORS Origins.

How Trading Works

When a user places a trade on Polymarket through this app:

Wallet Connection: The user connects via Dynamic’s embedded wallet
Network Check: The app ensures the user is on Polygon network
Credential Initialization: The app derives or creates Polymarket API credentials by signing a message
Approvals: The app checks and requests necessary ERC20/ERC1155 approvals for USDC and outcome tokens
Order Placement: A market order is submitted to Polymarket’s CLOB API
Confirmation: The user sees success/error feedback

Conclusion

If you want to take a look at the full source code, check out the GitHub repository. This integration demonstrates how Dynamic’s embedded wallets can seamlessly connect to prediction markets like Polymarket, providing users with a secure and user-friendly trading experience. The combination of Dynamic’s authentication flow and Polymarket’s CLOB API enables complex trading operations with minimal friction.

Getting Started

Wallets

Authentication

Security

Rate Limits

Developer Dashboard

Migrations

Wallets & Chains Integration

Troubleshooting

Recipes

Build a prediction market trading app with Polymarket

What We’re Building

Key Components

Building the Application

Project Setup

Install Dependencies

Configure Environment

Configure Wagmi for Polygon

Configure Providers

Define Contract Constants

Create Markets API Route

Create Markets Hook

Create Trading Hook

Create User Positions Hook

Build the Market Card Component

Build the Main Page

Run the Application

Configure CORS

How Trading Works

Conclusion

Additional Resources

Getting Started

Wallets

Authentication

Security

Rate Limits

Developer Dashboard

Migrations

Wallets & Chains Integration

Troubleshooting

Recipes

​What We’re Building

​Key Components

​Building the Application

​Project Setup

​Install Dependencies

​Configure Environment

​Configure Wagmi for Polygon

​Configure Providers

​Define Contract Constants

​Create Markets API Route

​Create Markets Hook

​Create Trading Hook

​Create User Positions Hook

​Build the Market Card Component

​Build the Main Page

​Run the Application

​Configure CORS

​How Trading Works

​Conclusion

​Additional Resources

What We’re Building

Key Components

Building the Application

Project Setup

Install Dependencies

Configure Environment

Configure Wagmi for Polygon

Configure Providers

Define Contract Constants

Create Markets API Route

Create Markets Hook

Create Trading Hook

Create User Positions Hook

Build the Market Card Component

Build the Main Page

Run the Application

Configure CORS

How Trading Works

Conclusion

Additional Resources