Hyperliquid challenges Polymarket! The new prediction market will replace oracles with "Validator Governance"

Hyperliquid announces support for off-chain event canonical prediction markets, with the first target being the US May CPI. The platform replaces external oracles with validator governance, directly challenging Polymarket.

According to CoinDesk, Hyperliquid, a leading on-chain perpetual contract platform, announced on May 26 that it will support canonical prediction markets for "off-chain events," replacing external oracles with validator governance. This marks a positive challenge to Polymarket.

First market launched: US May CPI Year-over-Year Rate

The first market was launched on May 25, targeting the "US May CPI Year-over-Year Rate," with over $10,300 in trading volume within 12 hours. Future markets will cover US inflation data, Federal Reserve decisions, and other macroeconomic events. The settlement contracts are fully collateralized, settled in 1 USDC or 0.

Replacing UMA Oracle with Validators: Self-Voting Settlement

The key difference lies in the settlement mechanism. Polymarket uses UMA's "Optimistic Oracle" to handle settlement and disputes; Hyperliquid, on the other hand, is operated by node validators running automated news feed software, ingesting news themselves, deciding which markets to list, and determining settlement outcomes through on-chain governance voting. In other words, Hyperliquid removes the "external oracle" intermediary entirely, aligning the decentralized trust assumption of settlement with its network itself.

HIP-4 Upgrade Extension: From Perpetuals to Multi-Asset

This mechanism is an extension of Hyperliquid's proposed improvement HIP-4. For Hyperliquid, this means officially expanding from a leading on-chain perpetual contract platform to a comprehensive trading platform covering multiple assets; for existing prediction markets like Polymarket and Kalshi, it is a direct challenge from a high-liquidity DEX. The key going forward is whether validator governance can maintain decision quality on contentious events, and whether the "no oracle" design can sustain trust.

  • This article is reprinted with permission from: Chain News
  • Original title: Hyperliquid Launches Validator Governance Prediction Markets: Replacing Oracles with Nodes to Challenge Polymarket
  • Original author: Elponcrab
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