Polymarket rolls out Protocol V2 with unified exchange and oracle system

Polymarket has begun rolling out Protocol V2, a rebuild of its prediction market infrastructure designed to replace the collection of smart contracts and adapters that underpin its current system.

The new architecture uses a single ERC-1155 positions contract, one collateral asset called pUSD, one exchange supporting multiple market types and a unified router.

Polymarket said its existing infrastructure was built around Gnosis’ Conditional Tokens Framework from 2019, forcing the platform to add separate contracts and adapters as it introduced new products. Protocol V2 is intended to consolidate those components and make future upgrades easier.

The system initially supports binary markets, Atomic Neg-risk, Incremental Neg-risk and combinatorial markets. Position IDs encode the market type, market and outcome directly, allowing the protocol to identify a position without relying on additional contracts.

Resolution is also being redesigned through a new OracleAggregator that can connect to multiple oracle providers, including UMA and Chainlink, while leaving room for additional sources in the future.

Protocol V2 also introduces native support for eventually bridging positions, collateral and market resolutions across networks. Polymarket said those capabilities are intended to support a future multichain expansion but will not be activated immediately.

Unlike the current contracts, the new system is upgradeable through a governance process, allowing Polymarket to add features without requiring users and integrators to migrate to entirely new contracts each time.

The company said the architecture also lays the groundwork for features currently in development, including scalar resolution and directional collateral return.

Polymarket plans to run several canary markets using Protocol V2 from Oct. 5 through Oct. 30. The platform is tentatively targeting Nov. 2 to begin routing newly created markets through the new protocol.

Alongside the smart contract upgrade, Polymarket is launching Data API V2, a Rust-based service powered by its internal onchain indexer. The new API supports Protocol V2, standardizes response formats and adds cursor-based pagination for trade and activity feeds.

Polymarket said Protocol V2 has been audited by Cantina, Certora, Quantstamp, Sigma Prime, Zellic and Pashov, while Certora also formally verified the code. The protocol carries a bug bounty of up to $5 million for critical vulnerabilities.