Polymarket, UMA, and EigenLayer Join Forces to Research and Develop the Next-Generation Prediction Market Oracle

This initiative aims to enhance dispute resolution mechanisms, align incentives for participants, and improve scalability and security for prediction markets.

Prediction market protocols Polymarket, UMA, and EigenLayer are collaborating to develop the next-generation prediction market oracle, aiming to enhance dispute resolution, align incentives, and improve scalability.

This initiative comes as prediction markets have seen a surge in activity, with Polymarket boasting $6B in cumulative trading volume and having resolved 14,000+ markets since 2020. These markets provide decentralized, real-time forecasts, but existing oracle data infrastructure and Schelling Point-based resolution systems face challenges in scaling systems around natural language processing and subjective market outcomes.

By combining Polymarket’s scale, EigenLayer’s intersubjective verification, and UMA’s Optimistic Oracle (OO) — which secures over $1B in value — the next-gen oracle will introduce flexible dispute resolution, greater community alignment, and enhanced intersubjective security. This evolution will scale oracle capacity, optimize dispute mechanisms, and improve resilience against manipulation.

"Prediction markets are only as good as their ability to resolve outcomes fairly and efficiently. By leveraging new security models and dynamic resolution mechanisms, we're setting the stage for a new era of scalable, community-driven oracles," says Shayne Coplan, Founder of Polymarket.

"EigenLayer is fundamentally about enabling new trust models in decentralized systems. Prediction markets are one of the most powerful tools for collective intelligence, but their security depends on oracles that can scale and adapt," says Sreeram Kannan, Founder of Eigen Labs, the creator of EigenLayer. "We're thrilled Uma and Polymarket will be utilizing the intersubjective security enabled by EigenLayer and the EIGEN token, and we are excited to contribute to the research to design this next-gen oracle, so it is more resilient, transparent, and aligned with their users."

The next-gen oracle will introduce several innovations designed to meet the evolving needs of prediction markets and address weaknesses in the Schelling Point systems:

The oracle will integrate multiple layers of subjectivity to create a more nuanced and accurate representation of the market's belief. This will involve combining EigenLayer's intersubjective verification with UMA's OO to create a hierarchical structure of subjective attestations.

The integration of EigenLayer will also enable the scaling of oracle capacity for natural language processing and subjective market outcomes. This will be achieved through EigenLayer's distributed network of verifiers, who will collectively attest to the market's belief, reducing the need for large-scale on-chain computations and gas costs.

To further optimize dispute mechanisms, the next-gen oracle will introduce a dynamic adjustment of participation costs based on the level of participation in the market. This will ensure that the costs of resolving disputes are aligned with the size and activity of the market, creating a more sustainable and efficient dispute resolution system.

"Prediction markets thrive on trust, transparency, and security. By evolving our oracle infrastructure, we're ensuring these markets can scale effectively while maintaining the economic integrity of their resolutions," says UMA Co-Founder Hart Lambur.

Prediction markets have emerged as a powerful tool for collective intelligence, cutting through bias and misinformation to provide real-time, market-driven insights. However, their long-term success depends on the ability to securely resolve complex, subjective disputes at scale.

This collaboration between Polymarket, UMA, and EigenLayer aims to tackle one of the toughest challenges in decentralized computing: verifying truth in a trustless world. Polymarket provides the leading prediction market infrastructure, UMA delivers an optimistic oracle for open-ended dispute resolution, and EigenLayer offers verifiable intersubjectivity, reinforcing security against manipulation.

Together, these technologies will help define how decentralized truth is established, ensuring that prediction markets—and the broader ecosystem of intersubjective truth protocols—can evolve into a more scalable, resilient, and participatory future.

As we continue this research, we also invite market participants, community members, and researchers to help shape the next generation of the optimistic oracle.