What are Prediction Market Clarifications?

Introduction

Prediction markets thrive on clear rules and fair resolutions. But what happens when something unexpected occurs and throws those rules into question?

That’s where clarifications come in. If you’ve been active in UMA voting or traded on Polymarket, you’ve probably seen them before. But what exactly are they, why do they happen, and how do they impact you?

Let’s break it down.

What Are Prediction Market Clarifications?

Clarifications (also called additional context or bulletin boards) are official statements or updates to a prediction market’s resolution criteria. When markets face unexpected twists, clarifications provide the essential context to ensure fair resolutions. They’re like bulletin board updates—clear, direct adjustments that keep the market aligned with reality.

Imagine you’re trading in a market, asking, “Will Candidate X win the election?” Then, something unexpected happens: Candidate X drops out of the race. The original rules never covered this scenario. That’s where clarifications step in—they tell you exactly how the market will handle this twist, ensuring traders aren’t left in the dark.

In other words, the market gets clarifications when something unexpected occurs that wasn’t accounted for in the original market rules.

Fun fact: Clarifications are a community-led initiative from the UMA and Polymarket community.

Why Do Clarifications Happen?

Prediction markets involve real money, and when there’s an economic gain to be made, some people will try to exploit loopholes. Without clarifications, bad actors could manipulate uncertainty to extract value unfairly.

Clarifications protect you by:

• Providing clarity when markets face unexpected situations so outcomes stay fair.

• Preventing manipulation so no one takes advantage of vague rules.

• Keeping markets running smoothly so traders know exactly what to expect, even when events take a turn.

Who provides clarifications? The platforms that use UMA (e.g., Polymarket). These platforms provide extra context when necessary, and UMA provides voting-based verification based on the context provided.

Now, you might think: “If clarifications handle market uncertainties, don’t they replace dispute voting?”

The answer? No.

Do Clarifications Replace Dispute Voting?

No! Clarifications do not replace dispute voting.

Clarifications reinforce voting mechanisms used in securing onchain markets.

UMA’s Optimistic Oracle (OO) is the backbone of decentralized market resolution. Even when clarifications happen, UMA voters still need to verify and confirm outcomes based on the updated information.

Here are a few stats to keep in mind:

• Less than 1.5% of proposals are disputed, and clarifications are only a fraction of those.

• UMA voters still have the final say onchain, ensuring markets remain secure.

• Clarifications don’t override market outcomes—they provide crucial updates when rules need refinement.

The UMA DVM has never voted against a clarification—because these updates ensure accuracy, reinforcing UMA’s Shelling Point mechanism.

How Do Clarifications Affect UMA Voting?

When a clarification drops, it doesn’t change your role as a voter—it enhances it. Clarifications help you make informed decisions and vote accurately.

Here’s what you should keep in mind as a UMA voter:

• Clarifications help you make the right call by providing critical context.

• Voting still matters. Your vote ensures that the market resolves correctly.

• Watch out for misinformation. Some participants might push narratives against clarifications for personal gain.

Clarifications exist to help you. Make sure to keep an eye out for them and review them carefully, especially when shared by UMA team members in market discussions.

Clarifications in the Wild: Polymarket Example

To bring everything home, let’s look at an example of a recent clarification on Polymarket.

In January 2025, a prediction market on Polymarket titled “TikTok Banned in 2025” was proposed and later disputed. Polymarket issued a clarification, stating: “A law which banned TikTok, as upheld by the Supreme Court, took effect on Sunday. Thus, this market should resolve to “Yes.”

The clarification addressed a key event that happened after the market was created. In this case, the U.S. Supreme Court upheld a specific law that banned TikTok, which was an extremely important context for both market participants and UMA voters to be aware of.

The clarification changed how traders and UMA voters interpreted the market. It gave everyone crucial context that ensured the fairest possible resolution. By providing this critical context, Polymarket was able to reduce the ambiguity in the market and reinforce the effectiveness of UMA’s Shelling Point economics in the dispute vote.

The Bottom Line

Clarifications help keep prediction markets fair, transparent, and secure. They reduce ambiguity, prevent market manipulation, and help you make accurate decisions when unexpected events happen.

If you’re an UMA voter, review clarifications carefully, understand their implications, and vote accordingly. If you have questions, check out our voting FAQ for more information.