A disputed Polymarket contract on whether Strategy sold Bitcoin by May 31 resolved to “No” after two dispute rounds, despite Strategy later disclosing that it sold 32 BTC during the market’s covered window.
UMA Optimistic Oracle (UMA) token holders voted to settle the market in “no” following a second resolution cycle that closed at 12:34 am UTC on Thursday, blockchain data shows. An overwhelming 98.6% of the 607 participants voted for the market to resolve in “no,” while only 1.4% voted “yes,” data from Betmoar shows.
Polymarket said that no information, onchain data or credible reporting confirmed a Strategy sale within the market’s timeframe, adding that confirmation achieved “outside of the market’s time frame does not qualify.”
Strategy sold 32 BTC between May 26 and May 31, but disclosed the sale in a Monday filing, after the market’s deadline.
The resolution adds to concerns about Polymarket’s token-weighted dispute resolution system, where the wallets with the largest UMA token holdings have proportionally more voting power.
Multiple users cried foul, arguing that the market should have resolved based on when the sale occurred rather than when it was confirmed. One unfortunate trader reported a $500,000 loss tied to their event contract. Over $80 million had been wagered on whether Strategy would sell Bitcoin by May 31, Cointelegraph reported on Tuesday.
Polymarket dispute on Strategy selling Bitcoin by May 31. Source: Betmoar
“Prediction markets should price what happens, not how the oracle will reinterpret rules after the fact,” as resolution integrity “trumps any single outcome,” said Galaxy Research in a Wednesday X post, adding:
“We outline clear fixes: lock criteria at listing, deterministic resolution for verifiable events, and structural changes ahead of CFTC regulation.”
Galaxy also disclosed a financial interest in the market, adding that it bought “yes” shares as part of its strategy to routinely hedge prediction market positions.
Polymarket declined to comment on the outcome of the contract or whether it would undertake a further review of the market.
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Polymarket’s dispute resolution system raises concerns
The largest vote in the dispute came from blockchain wallet borntoolate.eth, which held 3.11 million UMA tokens, followed by Kevin Chan with wallet “0xd2a,” who held 1.53 million tokens.
Dispute resolution can be profitable for large token holders. Wallet borntoolate.eth netted over $299,000 from voting on event contract disputes, while the Kevin Chan-tagged wallet bagged over $370,000.
UMA token holders who voted on the disputed Strategy market. Source: Betmoar
Critics also pointed to earlier disputed Polymarket resolutions as evidence of broader concerns with UMA’s token-weighted voting model.
An event contract on whether Ukraine agrees to US President Donald Trump’s mineral deal before April 2025 was resolved as “yes” in March, following two rounds of disputes, despite the agreement being signed only on April 30.
Multiple users called it a “governance attack and whale manipulation but Polymarket did nothing with it,” commented Polymarket trader fr1ko.eth in a Tuesday X post.
The developments come a day after nine Democratic Party lawmakers in the US House of Representatives called on the US Federal Trade Commission to investigate how prediction markets advertise to customers and how they present themselves to regulators.
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