Polymarket Taps Chainlink for More Accurate Prediction Market Resolutions

Polymarket is taking a new approach to how certain markets are resolved on its platform, giving oracle platform Chainlink authority over some of its users’ price predictions.

Focusing on the “accuracy and speed” of markets that hinge on the performance of digital assets, Chainlink said in a press release on Friday that it is now Polymarket’s go-to source for determining whether a price was reached within a certain period of time.

In a statement, Chainlink co-founder Sergey Nazarov called it a “pivotal milestone,” saying “high-quality data and tamper-proof computation” can bolster trust in prediction markets. (Disclaimer: Myriad Markets is a product of Decrypt’s parent company, DASTAN.)

Although the partnership with Polymarket will initially focus on markets for Bitcoin and other cryptocurrencies—Chainlink’s data streams provide data on 366 trading pairs—Chainlink said the firms are also exploring ways to tackle “more subjective questions.”

Could that include whether Ukrainian President Volodymyr Zelenskyy wore a suit, or whether the OceanGate’s Titan submersible had been found? In both instances, some Polymarket users cried foul, arguing that the wrong outcome was reached after UMA’s dispute system kicked in.

Polymarket declined to comment to Decrypt.

Chainlink continuously fetches and aggregates off-chain data from multiple sources, but as Polymarket’s primary oracle, UMA’s system determines what is true by asking token holders to weigh in and vote on resolutions with tokens that they own. 

UMA’s protocol features incentives that are designed to encourage truth-seeking, but some have claimed that the system can be manipulated by token-rich stakeholders. 

In March, Polymarket acknowledged that one market involving a minerals deal between the U.S. and Ukraine “resolved against the expectations of our users and our clarification” due to UMA, but it still said the outcome “wasn’t a market failure,” so it couldn’t offer refunds.

Last month, UMA passed a proposal that limited who can propose resolutions for Polymarket disputes. It involved the creation of an allowlist that initially had 37 proposers, according to an official update posted within UMA’s Discord server.

Chainlink’s tie-up with Polymarket comes as the oracle platform onboards other high-profile names. Earlier this week, co-founder Nazarov said that Chainlink is collaborating with additional Trump administration agencies to bring certain functions of the federal government on-chain, after working with the Department of Commerce on data feeds.