An anonymous individual utilizing the Ethereum wallet ‘BornTooLate.Eth’ has conducted a governance assault on UMA, a decision-making oracle employed by Polymarket, in an attempt to manipulate the outcome of a contract related to Ukraine by becoming one of the top holders of UMA tokens.
UMA is a decentralized “optimistic” oracle protocol that settles disputes in prediction markets by enabling UMA token holders to vote on contentious results. It has encountered several controversies surrounding its handling of disputed markets, including situations like Barron Trump’s connection to a presidential meme coin, the situation of the OceanGate submarine, and Venezuela’s disputed elections, facing backlash for its subjective decisions that irritated certain market participants.
On-chain records indicate that BornTooLate.Eth possesses around 1.3 million UMA tokens, positioning them among the top five governance stakers and providing them considerable power over the resolution of UMA disputes.
In the case of the Ukraine-themed market targeted, the contract prompted bettors to speculate on whether an agreement would be finalized involving U.S. access to the country’s rare earth resources by the end of March.
Reports indicate a deal may be in the pipeline, although nothing has been finalized. However, on Polymarket, the contract resolved to ‘yes’ after BornTooLate.Eth utilized their staked UMA tokens to vote ‘yes’ on the outcome.
A Questionable Trading Strategy
Interestingly, this attack appears not to have resulted in significant profits for the involved parties.
Market insights from on-chain data aggregator Polymarket Analytics reveal that the top winner from the contract earned just over $55,000.
Similarly, losses were limited compared to other notable Polymarket contracts, with the largest loser losing about $73,000.
An etherscan page related to BornTooLate.Eth indicates that this actor began gathering UMA tokens over a year ago. Given their holdings of over 1.3 million tokens, amassing that treasury for the attack would have required over $2 million.
Polymarket has stated that no refunds will be issued, claiming this is not a “market failure,” and announced on Discord that they are collaborating with the UMA oracle team to prevent similar occurrences in the future.
“This market concluded contrary to the expectations of our users and our clarification,” a representative stated on Discord. “We’re dedicated to pioneering the future of prediction markets, necessitating the creation of resilient systems that everyone can trust.”
Polymarket founder Shayne Coplan did not respond promptly to a request for comment.