Polymarket Reshapes Oracle Trust Mechanism: From Polygon Dependency to the L2 Autonomous Era

Polymarket is undergoing a profound infrastructure transformation. Recently, in the official Discord community, project team member Mustafa confirmed a key decision: building an independent L2 network has become the top priority for the current platform. Behind this shift lie three major challenges faced by prediction market platforms during scaling—performance bottlenecks, trust mechanism flaws, and upcoming regulatory compliance pressures.

Performance Ceiling: The Inevitable Shift from “Leasing” to “Self-Built”

For a long time, Polymarket benefited from early expansion via the Polygon network, but as trading volume grew exponentially, this shared infrastructure model gradually revealed critical weaknesses.

In 2025, the Polygon mainnet experienced 15 various network anomalies, including maintenance interruptions and performance drops. One serious outage occurred from December 12 to 13, where the Polygon network entered a state of “intermittent lagging transactions.” This disruption caused slow RPC responses on the mainnet, with a large backlog of prediction orders in the mempool that could not be processed normally. Even more problematic was the “consensus finality delay” issue on September 10—although transactions on Polygon’s mainnet were gradually confirmed, the consensus layer failed to output final confirmation signals, trapping Polymarket’s settlement system in a multi-hour deadlock.

For a platform preparing for an IPO, backed by ICE, the parent company of the New York Stock Exchange, such infrastructure instability directly threatens compliance prospects. Users, facing rapidly changing event information, lose betting opportunities due to network congestion, which directly undermines trust in the platform.

By building an independent L2, Polymarket can free itself from competing with other dApps for block space, while enabling deep customization of prediction market-specific needs. This not only means a more stable network environment but also grants Polymarket core control over block ordering, optimizing transaction friction and reclaiming fee income previously flowing to the public chain.

Polymarket has launched a Builder program and Wiki documentation on its official website, systematically opening interfaces and tools to external developers. While it’s difficult to build a truly closed ecosystem on public chains, as L2 matures, applications around prediction, settlement, and information games will be able to migrate natively to this L2 network, bringing in users, trading volume, and real-world use cases.

Oracle Crisis: Managing UMA Trust Mechanism Violence

If high-performance, low-failure L2 is the backbone of the prediction empire, then oracles are the heart of this machine. For a long time, Polymarket has relied heavily on UMA’s optimistic oracle mechanism, but with explosive growth in trading volume, this external dependency is evolving into a potential systemic risk.

UMA’s dispute resolution process often requires up to 48 hours for confirmation—24 hours of anonymous voting plus 24 hours of reveal. Such delays not only severely hinder capital turnover but also leave loopholes for large traders to manipulate the system.

In 2025, the Polymarket community experienced several serious disputes, serving as painful lessons about UMA’s flaws. The most controversial was the $237 million “Zelensky Suit Event.” Although multiple authoritative media outlets recognized Zelensky’s attire at the NATO summit as fitting the definition of a suit, UMA whales manipulated the outcome by voting against this result for their own benefit. The subsequent “Ukrainian Mineral Contract Event” worsened the situation—without official confirmation, UMA whales again used governance power to force decisions. Although Polymarket acknowledged the resolution was “unexpected,” it refused compensation citing protocol restrictions.

This “governance tyranny” violates the objective consensus foundation of decentralized prediction markets, causing losses in the millions of dollars, essentially mocking the fairness of decentralized markets.

Polymarket has already begun migrating price data streams from crypto prediction markets to Chainlink, reflecting an awareness that for prediction markets requiring high precision and resistance to manipulation, simple external voting mechanisms are no longer sufficient.

By vertically integrating native oracles, Polymarket can build a trust system based on POLY token staking within its own protocol. Daily settlements will be executed quickly and cheaply by highly automated native nodes, while complex disputes will be decided by genuine POLY stakeholders. This sovereignty-level oracle integration not only significantly shortens settlement cycles but also eliminates rent-seeking space created by external middleware.

Dual Structure of Equity and Tokens: POLY as Production Material

Regarding the positioning of the POLY token, the core is to clarify the relationship between “equity” and “token.”

As Polymarket’s valuation rises to $9 billion and IPO planning begins, there was concern that the tokenization route might be replaced by compliance-driven IPO processes. However, on October 24 last year, CMO Matthew Modabber confirmed on Twitter the issuance and airdrop plan for POLY. When combined with subsequent infrastructure planning, Polymarket is pursuing a unique “dual-track” approach.

The equity structure, as a vehicle from the traditional financial world, carries brand value, compliance licenses, and company profits, providing long-term reference points for traditional investors; meanwhile, POLY is defined as the “production material” and “industrial raw material” of the prediction market ecosystem. It is no longer a superficial governance token but a necessary carrier for driving L2 network operation, staking oracle nodes, and serving as a physical medium for settlement and fees within the ecosystem.

This positioning of token “usability” not only avoids regulatory risks of being classified as a security but also allows POLY to deeply integrate into protocol and application layers, achieving a true coupling of value and practical use.