The Polymarket Mineral Deal Controversy: A Tale of Negligence and Manipulation
| |
Background: The “Ukraine agrees to Trump mineral deal before April?” market an from February 2 to March 31, 2025. There was over $7M in volume on this market. The market’s resolution specifically stated only official statements from the U.S. and Ukrainian governments would count as evidence. On March 25, 2025, a user submitted a “Yes” proposal, claiming the deal had been agreed upon. This was disputed, kicking off UMA’s two-day voting process: a one-day commit period (where voters lock in their choices) followed by a one-day reveal period (where votes are finalized). If a consensus threshold is reached, the market resolves accordingly. This is where things got messy. After every voter had already committed their votes, Polymarket stated at 11:58 PM UTC on Sunday, March 23 (just two minutes before the commit period ended) it was “too early” for the market to resolve and that, based on available evidence (or lack thereof), it wasn’t a “Yes” yet. No official statements from the U.S. or Ukraine confirmed a deal; Trump’s vague claim of a “soon-to-be-signed” agreement and Zelenskyy’s musings about a “bigger deal” didn’t meet the criteria. Traders betting “No” breathed a sigh of relief, assuming Polymarket would enforce its own rules. However, one UMA whale cast ~25% of the vote in favor of "Yes," ignoring Polymarket’s clarification entirely. Now, UMA slashes rewards for an incorrect vote (aka doesn't align with majority). The big wallets doubled down on “Yes” to secure their rewards and avoid losses. By Monday, March 24, at 11:58 PM UTC—two minutes before the reveal period closed—Polymarket issued another clarification, this time conceding that the market would resolve per UMA’s vote: “Yes.” The result – "yes" won despite not being "yes" per market rules. In addition to the whale vote, many UMA voters are a core group of token holders, many affiliated with or part of the UMA team itself. Their decision to push “Yes” wasn’t a grand conspiracy; it was a lazy, reward-driven choice to disregard Polymarket’s last-second guidance. They faced a binary gamble – a prisoner's dilemma – to vote with the pack or risk being slashed. They chose the path of least resistance. While UMA’s whales bear some blame for their cavalier voting, Polymarket also deserves criticism. They could have intervened earlier, giving voters clear direction during the commit phase, or even paused the market entirely via an emergency function, but instead they issued a clarification so late it was effectively useless, and then went along with UMA’s vote. Polymarket acknowledged the controversy on the platform’s Discord server, admitting the outcome went against user expectations and Polymarket’s own clarifications. However, the team classified it as an unprecedented situation rather than a market failure, stating they could not issue refunds. For my own thoughts, I am a deep believer in Polymarket and predictions as a tool. It's clear there are still problems to solve, exploits to patch, and incentives to be optimized. But it's also clear there are people working on these problems. Looking long term (10+ years out), this technology will become insanely powerful and ubiquitous, but there will be growing pains along the way. submitted by /u/002_timmy |
