- Trueo’s recent verdict in one of its disputed events has led Ethereum founder Vitalik Buterin to emphasize the need for prediction markets to transition to decentralized oracles.
Trueo, a fully onchain, yield-bearing prediction market protocol, has recently come under scrutiny for its resolution of an event contract. The incident even caught Ethereum (ETH) founder Vitalik Buterin’s attention, prompting him to highlight the need for a reliable decentralized oracle for prediction markets.
The Trueo Issue
Trueo has delivered its verdict on what it considered “the most contentious market” it has ever encountered. The issue stemmed from an event predicting that Polymarket will launch its own token in 2026.
The platform indeed launched Polymarket USD (pUSD) in April, a collateral token and stablecoin backed 1:1 by Circle’s USDC. Users can acquire it by depositing USDC, then they can use pUSD to place their “Yes” or “No” shares on an event. To date, the stablecoin has a market cap of over $291 million.
However, some users argued that it was too early to resolve the market. They highlighted that the “token” the event referred to was supposed to be a network or governance token, not a stablecoin.
The pseudonymous Millie, a member of the Oracle Council, said their group later voted 3-2 in favor of the “Yes” outcome, reaffirming the platform’s original resolution. This individual was one of the council members who voted to preserve the initial result.
The council member admitted that the event’s phrasing was certainly ambiguous and didn’t capture the market’s true essence. Nonetheless, the result fulfilled the criteria in a literal sense when the prediction market platform launched pUSD.
However, the supermajority, comprising true holders and attesters, later overruled the council and sought to reset the outcome. Their overwhelming vote became the binding ruling in the arbitration.
Millie acknowledged that many are unhappy with the final verdict, as many have voted “Yes” to the event. Nevertheless, the problem highlighted Trueo’s need for more precise resolution rules. The council member also raised the possibility of similar incidents in the future.
Vitalik Butterin Chimes In on the Conversation
Buterin reminded Trueo that a prediction market is only as good as its oracle. Hence, he advised the platform’s core developers to adopt decentralized oracles to avoid heavy centralization and financialization, which could erode its integrity.
Likewise, the Ethereum founder recommended Trueo to make attester voting private in its next upgrade. The setup would minimize whale influence and social pressure while ensuring that the platform’s resolution process relies solely on independent signals.
