Polymarket launches Protocol V2 with upgraded smart contract infrastructure
The prediction platform Polymarket initiates its Protocol V2 deployment with a November timeline set for transitioning new prediction markets, as current user positions continue operating on the existing infrastructure.
The prediction market platform Polymarket is undertaking a comprehensive rebuild of its smart contract foundation, establishing the framework for additional market capabilities and possible expansion to other blockchain networks beyond Polygon.
On Monday, Polymarket initiated the deployment of Protocol V2, unveiling an updated smart contract architecture engineered to accommodate various market formats through a unified exchange platform, as detailed in a social media post on X by Rajath Alex, who serves as the company's head of protocol.
The company is conducting tests of the new system across a select group of active markets until Oct. 30, with Nov. 2 established as a preliminary date for migrating newly created markets to the V2 protocol.
This comprehensive upgrade replaces the existing infrastructure that was built on code originally developed in 2019, which necessitates deploying additional smart contracts whenever new market formats need to be supported.
New protocol uses pUSD as sole collateral token
The V2 protocol implementation utilizes Polymarket USD (pUSD) as the exclusive collateral token, combined with a unified contract for position tokens and a single exchange capable of supporting various market configurations.
Launched as a component of an exchange enhancement in April 2026, pUSD functions as a collateral token with 1:1 backing by Circle's USDC, a stablecoin pegged to the US dollar.
The upgraded protocol architecture is engineered to enable the transfer of positions, collateral assets and market resolution data across different blockchain networks, though Polymarket has yet to reveal when cross-chain capabilities will become available or which blockchain networks will be integrated.
At present, Polymarket runs its prediction market operations on Polygon, a scaling solution for Ethereum, which also serves as the blockchain where pUSD tokens are issued.
Cointelegraph contacted Polymarket to obtain information regarding which blockchain networks the platform intends to integrate and the expected timeline for this multi-chain expansion.
Upgradeable contracts support new features and oracles
The V2 protocol rollout brings upgradeable smart contract functionality, enabling Polymarket to adjust and enhance contracts via a "secure governance process," which minimizes the requirement to launch additional contracts when implementing new platform features.
The update also brings OracleAggregator, an infrastructure component engineered to interface with multiple oracle services, including UMA and Chainlink, for the purpose of establishing market outcomes.
According to Polymarket, the upgraded system has completed security audits conducted by prominent blockchain security firms including Cantina, Quantstamp and Zellic, along with formal verification performed by Certora. The platform is providing bug bounty incentives reaching up to $5 million for the discovery of critical security vulnerabilities.
As outlined in the Protocol V2 migration documentation, current user positions will remain on the existing protocol and will not undergo conversion to V2, and those accessing the platform through the app or website will not be required to complete technical migration procedures, though users may encounter prompts to authorize new contracts during trading activities.