Arbitrage#111

Merge/Split Set-Completion Arbitrage

Polymarket's underlying contract lets you split $1.00 of collateral into a matched Yes+No pair, or merge a Yes+No pair back into $1.00. When you can buy Yes and No together for under $1.00 (or split collateral and sell both legs for over $1.00), run the mint/merge round-trip for a riskless spread after gas. The edge is exploiting the collateral primitive directly, not just complementary prices on the order book.

What you need to run it

ConditionalTokens split/merge integration on Polygon
Simultaneous two-leg book monitor for the condition
Gas-net spread gate + atomic execution path
USDC float for collateral splitting

Where this applies

Markets on Polymarket where merge/split set-completion arbitrage is the natural play:

Will the US and Iran reach a ceasefire by December 31, 2026?
Will OpenAI release its next flagship model before December 31, 2026?
Will ETH close above $4,500 on December 31, 2026?

Capabilities this demands

Custom code / APIOn-chain / walletLow latencySignificant capital

At a glance

CategoryArbitrage

Requirements4

CapabilitiesCustom code / API, On-chain / wallet, Low latency, Significant capital

VenuePolymarket (CLOB, Polygon)

Build it

Related arbitrage strategies

This is documentation, not advice. Poly Research & Robotics publishes how these strategies work because the method should be checkable — not as a recommendation to trade them. See the full strategy database (147 strategies) or the data resources directory.