Nine anonymous cryptocurrency wallets reportedly hold massive sway over who wins and loses some of Polymarket’s most contested prediction market bets – drawing blowback from a growing number of unhappy traders. 

Polymarket’s third-party resolution mechanism over the past year has adjudicated nearly 2,000 financial contracts, including bets on war, elections and geopolitical conflict, according to a Bloomberg News analysis of blockchain records and past votes. 

When the outcome of a Polymarket financial contract is challenged, the dispute goes to a vote among holders of UMA, an independent cryptocurrency.

The process was meant to create a crowd-sourced truth function that was decentralized so one entity or group couldn’t control contract outcomes. But the process has ended up handing over control to the biggest purchasers of UMA tokens, Bloomberg reported. That’s regardless of whether they make rational decisions or if they rule based on financial self-interest, as opposed to adherence to the real answer to the question being wagered on, according to the outlet.

In April, for instance, 230 contracts that racked up more than $1 billion in trading were decided through the process, up from 79 contracts six months earlier.

Polymarket, led by Chief Executive Shayne Coplan, can overrule decisions made by UMA voters, but it has rarely done so, Bloomberg reported.

In one recent case, UMA owners reportedly voted on how to resolve a contract tied to whether the US and Israel had struck Iranian facilities in February, with the odds bouncing around as traders tried to guess how the UMA holders would vote.

Traders bickered over whether the first military strikes in Iran met the exact conditions laid out in the Polymarket contract.

Just nine wallets accounted for roughly half of all UMA tokens that have voted on a Polymarket resolution over the past three years, the Bloomberg analysis found. That’s out of more than 6,400 accounts that have participated in at least one dispute. The nine wallets have essentially always voted together, and for the winning position.

The concentration of voting power has irked traders who say the top crypto owners have too much ability to tip votes in self-serving ways. 

Jan Czarnocki, general counsel at prediction markets startup Elastics, slammed Polymarket’s dispute ruling system.

“No serious investor will put money there as long as there’s no transparency regarding the resolution criteria,” he told Bloomberg. 

Czarnocki lost money on an UMA dispute about US forces entering Iran earlier this year. “Here it’s just a discretionary use of power basically.”

A spokesperson for Polymarket told Bloomberg that the company “is committed to setting the standard for market resolution in prediction markets, continually strengthening our infrastructure to deliver the transparency, reliability, and scale our users expect.”

The company behind the UMA process, Risk Labs, said last year it was working to improve or replace the process, Bloomberg reported at the time.

Since then, though, little has changed. Eigen Labs, which was working with Polymarket and Risk Labs on the update, said the project has been put “on pause.”

“The focus has been on market expansion from Polymarket’s end,” Eigen Labs’ founder Sreeram Kannan told Bloomberg. “We haven’t actually been working on that for the last several months.”

Polymarket declined to answer questions about changes to the UMA process. Risk Labs did not respond to requests for comment.

The UMA criticism points to Polymarket’s continued struggles to move away from its crypto roots as it aims to merge with the traditional financial system. The San Francisco-based company has also fallen behind its main rival, Kalshi, in trading volume, according to reports.

On Kalshi’s platform, when contract outcomes are disputed, the company’s employees get the final say on which side wins. That system has drawn its own complaints from customers, in part over a purported lack of transparency around decision making.