【Gondor】Lending protocol that allows open positions in the prediction market to be used as collateral / Solves the "fund lock problem" in the prediction market / @gondorfi
Vitalik also points out the "no interest problem" in the forecasting market.
Good morning.
I am mitsui, a web3 researcher.
Today I researched "Gondor".
🏦What is Gondor?
👀 Forecasting Market Challenges
💬 Forecasting market will start to yield
🧵TL;DR
Gondor is an emerging startup developing a DeFi protocol that allows USDC to borrow against open positions in forecasting markets such as Polymarket.
Raised an angel round from Maven11 Capital and others in August 2025 and is currently accepting prior access.
Plans to provide a mechanism to solve the "fund lock problem" in the prediction market and obtain liquidity while maintaining positions.
Vitalik also pointed out the "no interest problem" in the forecasting market, and it is possible that projects like Gondor will lead the way in the direction of yield assignment in the future.
🏦What is Gondor?
Gondor is a startup company that develops DeFi protocols for the forecasting market, and is developing services for the forecasting market ecosystem, including Polymarket.
This is an emerging project, with the first information being sent out on August 27, 2025, and is still in the process of accepting pre-access, with no product details available.
At the time of the project announcement, the company also announced an angel round of funding. The lead investor is Maven11 Capital, a European-based crypto asset fund. In addition, investors associated with blockchain platform Polymesh, decentralized exchange Rhino.fi, prediction market platform Futuur, and crypto lending company Salt participated.
So, the fine details are not that clear, but the conception was interesting and I will explain it.
◼️Products to be offered
Gondor plans to offer a position-collateralized lending protocol in the forecasting market.
Specifically for Polymarket users, the platform will allow them to borrow USDC using their open positions in the forecasted market (e.g., "Yes" share) as collateral.
Gondor aims to break this "capital lock" and dramatically increase capital efficiency.
Specifically, users can deposit (pledge) a "Yes/No" share of Polymarket on Gondor and borrow USDC up to a certain percentage of its value.
Naturally, there is a risk of liquidation (forfeiture of collateral) if the value of the position declines, but the borrowed USDC can be further reinvested in the forecasted market for leverage and the effect of doubling the position held can be targeted.
👀Predictive Market Challenges
In fact, the problems Gondor pointed out with the prediction market and its solution, position collateralized lending, had been discussed for some time.
Polymarket also published a blog titled PolyLend in June 2024, reporting on the implementation of a PoC in this area and open sourcing the idea and code details.
Polylend is an open source P2P lending protocol for lending against positions (YES/NO share) in the forecasting market Polymarket, with the aim of liquidating illiquid assets in the forecasting market and improving capital efficiency.
The user borrows USDC against the open position → escrow the collateral with a smart contract → repay the collateral at settlement, and Gondor is a realization of this very concept.
Most recently Vitalik also mentioned the forecast market issue.
Specifically, he points out that most major forecasting markets do not pay interest = no income, making them very unattractive as a hedging instrument. He sees this as a problem because there is no incentive to participate at the expense of the approximately 4% annual interest earned on stablecoin, etc. If this were improved, he expects that many hedging applications would expand and trading volume would increase.
This comment was made at a time when Polymarket's trading volume declined from $1.16 billion to $1.06 billion in July 2025. On the other hand, however, the number of active traders increased from 242,000 to 286,000, which could be taken as an indication that the trade size per trader is shrinking despite the increase in participants.
Vitalik has long mentioned that the forecasting market will be one of the core use cases for crypto, but you feel that there is a lack of incentives there.
💬Predictive markets will start to yield
The last part is a consideration of the summary.
Based on these considerations, we believe that the forecasting market will evolve into a world of yields in the future. There are three possible directions.
Open position lending like PolyLend and Gondor
Polymarket manages and returns deposited USDC behind the scenes
Polymarket offers its own stable coins, and users who buy positions with them receive a return on their investment of collateral funds.
I personally feel that all of this is going to be realized.
This is not just the prediction market, but I believe that we will be in a world where all assets (especially stable coins) will come with investment income.
However, in fact, the US GENIUS Act legally prohibits the payment of interest or yield for the holding or use of "payment stablecoin". Nevertheless, Coinbase is giving rewards to USDC holders. This is first of all because Coinbase itself is not an issuer, and also because it distributes the rewards to USDC holders as "staking rewards" or "interest equivalent rewards" rather than "interest".
So, even if we did number 3, we would not be able to give back directly to retention, but we feel that we could achieve this in the form of a reward to the position purchaser.
The more volume a forecast market handles, the more difficult it is to manipulate and the more reliable it becomes. As a business, we also need to increase transaction volume in order to earn transaction fees. So, as one of the major measures to achieve this, we predict that the world view will be one that yields some kind of open position management, management of deposited stable coins, and so on.
Gondor is likely to be one of its leading projects, and we will continue to follow the information.
This is the research for "Gondor"!
🔗Reference Link:HP / X
Disclaimer：I carefully examine and write the information that I research, but since it is personally operated and there are many parts with English sources, there may be some paraphrasing or incorrect information. Please understand. Also, there may be introductions of Dapps, NFTs, and tokens in the articles, but there is absolutely no solicitation purpose. Please purchase and use them at your own risk.
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mitsui
A web3 researcher. Operating the newsletter "web3 Research" delivered in five languages around the world.
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The author is a web3 researcher based in Japan. If you have a project that is interested in expanding to Japan, please contact the following:
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