Polygon Labs has teamed up with Manifold Trading, a firm known for its quantitative investing and market-making chops. Together, they want to raise the bar for trading standards & bring more liquidity to Polygon’s DeFi scene.
The initiative is focused on addressing some of the most prominent issues on DeFi, such as:
Liquidity fragmentation, price inconsistencies, and lack of support for large-order sizes. In regards to institutional funds and large trading entities, this is an indication that Polygon is moving away from small user infrastructure and into a fully scalable network that is capable of serious capital movements. I’ve noticed that when such infrastructure upgrades hit, adoption tends to accelerate.
So, for example, on a trade of $1 million, managing spread from 50 bp to 5 bp could deliver execution costs of about $4,500, indicating the effect of professional quality of liquidity, as explained below:
What most users don’t realize is that improved execution and deeper order books make DeFi not just usable, but investable by institutions — and that’s the leap Polygon is driving.
The timing is smart: Polygon’s recent infrastructure upgrades — faster finality, higher scalability, and better cross-chain liquidity — set the foundation so that now the market structure can evolve.
Of course, achieving true institutional-grade liquidity will depend on sustained participation from market makers and clearer regulatory frameworks. DeFi’s openness must balance with compliance for this model to scale globally, but this partnership is a critical step toward that maturity.
This move helps strengthen Polygon’s position as a mature financial infrastructure network, not just a gaming or DeFi novelty — in my view, this marks a key shift in how we perceive blockchain beyond retail.
The benefits ripple outward: better liquidity means more stable prices, fewer flash crashes, and stronger confidence for both users and developers launching new protocols on Polygon. It also plays into Polygon’s broader narrative — from scaling Ethereum to enabling institutional finance and real-world asset flows. The ecosystem logic is clearly evolving.
Do you believe improved institutional infrastructure — liquidity, depth, and execution — is the missing link for DeFi’s next growth wave? And will Polygon be the platform to deliver it?
