Polymarket Rolls Out V2 Upgrade with Single ERC-1155 Positions Contract, Pusd Collateral

Quick Take

• The new protocol supports four market types and consolidates positions, pUSD collateral, exchanges, and routing into a redesigned architecture.

Polymarket has begun running production canary markets on a rebuilt smart-contract system that will replace the Conditional Tokens Framework for new markets, protocol lead Rajath Alex announced on Monday.

Dubbed Protocol V2, the upgrade replaces the 2019 Gnosis-based framework with a single ERC-1155 positions contract, pUSD as collateral, one exchange for each market type, and a router. The redesign aims to reduce the layers of contracts that have been added as the platform introduced new market types, Alex said in an X post. 

According to the post, V2 will initially cover four market types, including Binary, Atomic Neg-risk, Incremental Neg-risk, and Combinatorial. Polymarket is introducing an OracleAggregator that can plug into UMA, Chainlink, and other data sources to resolve those markets.

The upgraded protocol also has provisions for moving positions, collateral, and resolutions across chains, a feature Polymarket says it will activate when it expands beyond its current network.

Alex said the canary markets will run through Oct. 30, with a tentative switch to Protocol V2 for net-new markets on Nov. 2. The company is also rolling out Data API V2, a Rust service built around its in-house onchain indexer.

The upgrade comes as Polymarket has been adding senior talent and building out its protocol team amid expansion. Alex joined in May, nearly three months before the company hired Travis VanderZanden, the founder of Bird and a former Uber and Lyft executive, as chief growth officer.

The company is also in talks to raise $1 billion at a $21 billion post-money valuation, with venture firm 1789 Capital set to contribute about $300 million, Bloomberg reported.

Polymarket said the V2 code has undergone audits by Cantina, Certora, Quantstamp, SigmaPrime, Zellic, and Pashov, with Certora also formally verifying the code. Its bug bounty offers up to $5 million for critical findings.