"Management Attack" Claim on the Largest Altcoin Platform: It Could Be Manipulation! - Coin Bulletin

Polymarket stated that they are aware of the "governance attack" allegations related to a bet that took place on the platform and that the UMA oracle provider may have been manipulated in the incident.

Between March 24-25, the $7 million bet titled "Will Ukraine accept Trump's mineral deal before April?" on Polymarket saw its acceptance probability rise from only 9% to 100%, leading to discussions and suspicions of coordinated manipulation. Despite the fact that Ukraine has not yet officially accepted Donald Trump's deal, this bet was resolved as "yes".

On social media platforms X and Reddit, a group of Polymarket users claimed that a large UMA token holder, whom they referred to as the "UMA whale", manipulated the outcome in their favor by casting a significant number of votes. An X user stated, "You should stop betting on Polymarket. The outcomes of events are determined by strong user groups, and votes are cast in their favor regardless of the real results."

Polymarket made a statement regarding this situation on their Discord channel and acknowledged that the outcome was contrary to market expectations. However, Polymarket stated that no refunds would be issued to bettors because "this situation was not a market error." "This was an unprecedented situation, and we were in war rooms all day long with the UMA team to ensure that this does not happen again" they stated.

Allegations of manipulation on UMA Oracle and Polymarket have come to the fore

Polymarket uses UMA's optimistic oracle system to determine the outcomes of prediction markets. Polymarket allows any user to propose a betting solution by putting up 750 dollars worth of USDC.e as collateral. However, when the results are up for discussion, UMA token holders can determine the final outcome through a decentralized voting process.

The platform stated that it aims to gather feedback from the community and is considering steps to prevent similar manipulations in the future. However, instead of outlining specific measures, the platform promised to develop more transparent rules. Polymarket had previously been criticized for making subjective decisions in controversial market outcomes.

Last year, Polymarket reversed the result given by UMA of "No" regarding a bet on whether Barron Trump would participate in the Solana-based DJT meme coin. This had led to speculation about the influence of large UMA token holders.

The U.S. Commodity Futures Trading Commission (CFTC) had previously stated that prediction markets like Polymarket, which are not subject to regulation, are susceptible to manipulation. These statements may have an impact on the platform's future developments.