TLDR
- Polymarket began testing Protocol V2 on October 5, with new markets switching over on November 2.
- V2 replaces the old Gnosis Conditional Tokens Framework with a single ERC-1155 position system.
- pUSD becomes the standard collateral for all new V2 markets.
- A new OracleAggregator lets markets use UMA, Chainlink, or other resolution sources.
- Six security firms audited the protocol, and bug bounties pay up to $5 million.
Polymarket is rolling out a new core system called Protocol V2. The change affects how markets are built, how bets are settled, and how data is tracked behind the scenes.
Testing started on October 5, 2026. Protocol head Rajath Alex said canary markets, which are limited test markets, will run through October 30. New markets are expected to start using V2 on November 2, though Polymarket called that date tentative.
Introducing Polymarket Protocol V2 https://t.co/FDzaZyiPnl
— Rajath Alex (@0xrajath) October 5, 2026
What Changes Under Protocol V2
The current system dates back to 2019. It uses Gnosis’s Conditional Tokens Framework, with separate adapters added over the years for different market types.
Protocol V2 removes that patchwork setup. It uses one ERC-1155 token contract to manage all outcome shares instead of spreading them across multiple systems.
Position IDs under V2 carry more information. Each token identifier now encodes the module, condition, and outcome directly.
The new system also adds a Router. This directs trade orders to the correct exchange contract for each market type.
Four market modules are live on the Polygon mainnet right now. They cover binary markets, two types of negative-risk markets, and combinatorial markets.
pUSD Becomes the Standard Collateral
Every new V2 market will use pUSD as its collateral. pUSD is a token that wraps USDC and USDC.e at a 1:1 ratio.
This token already existed before V2. It was introduced earlier in 2026 alongside other exchange upgrades.
What changes now is its role. pUSD becomes the shared collateral type across every new V2 market module, rather than one option among several.
Developers working with existing pUSD setups will not need to change their collateral process. But permissions tied to the old CTF system do not carry over automatically.
Polymarket says current CTF-based positions will stay as they are. Nothing is being force-migrated while trades are open.
Resolution also changes under V2. A new OracleAggregator sits above the reporting modules used to settle markets.
Current reporter options include UMA’s Optimistic Oracle, a Chainlink module, and a manual EOA reporter. Different markets can use different combinations, based on thresholds set for that market.
Chainlink’s module uses Data Streams for price-based markets. UMA remains the option for markets that settle based on real-world events rather than price feeds.
The code also includes early cross-chain infrastructure, using Chainlink’s CCIP transport layer. Polymarket has not announced a date for trading on additional chains. Polygon stays the main settlement chain for now.
Six firms reviewed the V2 contracts before launch. They include Cantina, Certora, Quantstamp, Pashov, Sigma Prime, and Zellic.
Certora completed formal verification on core components, including the Exchange, Position Manager, and OracleAggregator. Alex said critical bugs found through Polymarket’s bounty program can earn up to $5 million.
Developers face a separate deadline tied to data infrastructure. Polymarket’s Data API V1 retires on October 24, nine days before the planned V2 market switch.
The new Data API V2 uses an in-house indexer built by Polymarket. It replaces the older offset-based pagination with a cursor system, removing a previous 10,000-row limit.
Regular users will not need to do anything differently when V2 launches. Polymarket says some new markets may show additional approval prompts.
As of this report, canary testing is ongoing and scheduled to run through October 30, with the full switch to Protocol V2 for new markets set for November 2.
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