A few days ago, Polymarket founder Shayne Coplan announced that Polymarket has become the “official prediction market partner” of social media giant X and its artificial intelligence team xAI. The collaboration will combine data from the X platform with Grok’s analytical capabilities to provide millions of Polymarket users worldwide with more contextually rich and data-supported insights in real-time.

Currently, Grok is using data from Polymarket to predict real-world events with uncertainty. However, it is still unclear how this collaboration will change the user experience for X users.

This cooperation announcement happened to take place the day after Musk and Trump publicly clashed on social media. Notably, just two weeks ago, the X platform had also been in contact with Kalshi regarding a similar collaboration—it’s worth mentioning that Trump’s eldest son, Donald Trump Jr., is a senior advisor at Kalshi.

Considering the connection between Kalshi and the Trump family, this collaboration not only has product-level significance but is also interpreted as Musk’s deep exploration into restructuring political relationships, expanding financial infrastructure, and promoting the vision of a “super app.”

According to a press release from Polymarket, both parties will launch a series of jointly developed integrated features and unique experiences.

The agreement states that X will provide data-driven insights to Polymarket, while Polymarket’s prediction results will be fed back to the X platform, combining real-time interpretations from Grok and relevant X posts to achieve “explainable prediction data flow.”

X CEO Linda Yaccarino stated that this partnership will bring more value to X users who are already using Polymarket: “Polymarket has achieved a high level of transparency through its prediction markets and has become an important source of real-time information for many X users. We are excited to partner with Polymarket and integrate our data and technology through a series of innovative products to bring it to their users.”

Currently, Polymarket’s monthly trading volume has been gradually increasing after the election.

Why Polymarket?

Although Polymarket is currently one of the most popular prediction market platforms, it remains banned in the United States. In January 2022, the CFTC determined that it was illegally operating an unregistered trading platform and fined it $1.4 million.

At that time, Vincent McGonagle, acting director of the CFTC enforcement division, stated: “Market participants (such as Polymarket) should proactively communicate with regulators to ensure that the market remains sound and transparent, and provides protections under the Commodity Exchange Act and related regulations for customers.” The CFTC also issued a “cease and desist” letter to Polymarket, making it unable to operate legally in the U.S. market. This makes the collaboration between X and Polymarket particularly noteworthy—especially considering that Kalshi has currently been approved to operate a prediction market legally within the United States.

The rupture continues.

The current conflict between Musk and Trump is clearly difficult to disentangle from this new collaboration. As mentioned earlier, Trump’s eldest son Donald Trump Jr. is a senior advisor at Kalshi, which has previously discussed similar collaborations with X.

Despite the fact that such large-scale collaborations are usually not finalized in a day or two, the potential collaboration between Kalshi and X was indeed “officially announced and canceled” in a single day.

In May of this year, Bloomberg reported that Kalshi was in talks with xAI for collaboration, which includes leveraging xAI’s capabilities to provide “customized AI insights” for Kalshi. At that time, Kalshi CEO Tarek Mansour stated on social media: “I am very excited to announce that Kalshi is about to collaborate with xAI to accelerate the mainstream acceptance of prediction markets.”

But this joy was fleeting; the related statement was deleted on the same day and there has been no follow-up since.

This decisively led X to turn to Polymarket, which has not yet obtained compliance approval in the U.S., rich in symbolic meaning within both public opinion and political contexts. Against this backdrop, why did Musk choose to collaborate with Polymarket, which is in an ‘illegal’ status?

In the short term, this may just be a counterattack against Kalshi’s “turn to Trump”; from a long-term perspective, it could be a step in Musk’s challenge to the existing regulatory paradigm, building a “borderless financial tool” for X. He is clearly unwilling to let the path of his super app be constrained by the pace of traditional financial compliance.

X’s financial ambitions: from payment systems to prediction markets

In fact, X has a long-standing relationship with financial services. As early as 1999, Musk founded X.com, attempting to create an online hub for global financial transactions. Later, the company merged with Peter Thiel’s Confinity, giving birth to PayPal. Although Musk was ousted from the board, PayPal ultimately became the main brand, but he never abandoned the concept of “X.” In 2017, he bought back the X.com domain from PayPal, describing it as “having emotional value.” Five years later, he acquired Twitter and integrated it into X Corp, reviving the vision of the past.

“If you just want to be a niche payment system, PayPal is more suitable; but if you want to take over the global financial system, it has to be X.” This is a quote from Musk in “The Elon Musk Biography.” He has never hidden his ambition to turn X into “the Western WeChat”—a super platform that integrates social networking, payments, content, information, and identity.

Prediction markets are a new piece of the puzzle for X in moving toward this goal. The data structure and user behavior of Polymarket are highly complementary to the real-time public sentiment of the X platform, the AI analysis engine Grok, and the potential future XPay payment system. Musk clearly hopes that by incorporating Polymarket into the ecosystem, he will be able to capture social trends, public opinion tendencies, and even market sentiment from user-generated data, forming commercializable and actionable financial products.

The joint press release clearly states that the prediction results from Polymarket will be combined with Grok AI’s semantic understanding capabilities to generate “explainable predictive data streams,” providing X users with data insights that have real-time context. This provides a practical example for the long-term narrative of “AI×Finance×Social.”

At the same time, X is also accelerating its expansion at the product level. On June 1, Musk announced the launch of the XChat system, which features end-to-end encryption, automatic message destruction, file transfer in any format, and cross-platform audio and video calls, and claims to use a “Bitcoin-style encryption” architecture developed in Rust. Evolving from a social messaging tool to a comprehensive platform, X is rapidly approaching the structural prototype of WeChat.

Combined with the previously launched revenue sharing mechanism for content creators, the protest against Apple’s in-app purchase commission policy, and the strategy of providing advertising rebates to Twitter Blue users, it is evident that Musk is building a closed ecosystem “from content to payment.” The prediction market is expected to become one of the earliest profitable data product lines within this ecosystem.

Musk has stated that he “will never issue a cryptocurrency for X,” but that does not prevent him from continuously advancing the testing of on-chain financial functions. From a payment logic perspective, the combination of prediction markets and crypto assets has inherent advantages—trustless, quantifiable, and composable, aligning with the Web3 toolchain. If X launches a system similar to XPay in the future, Polymarket could also potentially become part of an embedded functional module, which complements the macro environment’s gradually crypto-friendly trend.

Polymarket tradable assets

As a blockchain-based prediction market platform, Polymarket has yet to issue a native token, which has led many users in the crypto community to look forward to its future token launch and airdrop.

UMA

At the same time, the market is also looking for direct speculative targets related to this. UMA is the core oracle of Polymarket, used to settle the outcomes of prediction markets, and Polymarket relies on UMA’s Optimistic Oracle to ensure the fairness and reliability of market results.

The collaboration between X and Polymarket may significantly increase Polymarket’s trading volume and user base, thereby enhancing the usage and demand for UMA. As the trading volume on Polymarket grows, the demand for UMA oracles will rise, potentially driving the staking and governance demand for UMA tokens, further pushing up the price.

Polycule

After the recovery of Polymarket’s trading volume, there have also been derivative projects developed around it.

Polycule is a streamlined Telegram trading bot designed to simplify trading on the Polymarket prediction market platform. On June 8, Polycule founder krish announced on the X platform that they secured a $560,000 investment from Alliance.

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