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Oracle Overview

PNP settles prediction markets with an LLM-assisted oracle — a structured, evidence-first system that evaluates real-world outcomes and commits results on-chain. No token-weighted dispute votes. No third-party resolution councils.
  • What it does: Decides YES/NO market outcomes or identifies non-resolvable/ambiguous cases.
  • How it decides: Evidence-first evaluation that checks authoritative sources, extracts specific data points, and computes thresholds explicitly — not vibes, not summaries.
  • Where it runs: Backs PNP markets with an API layer and a Solana settlement module.

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Two-Step Settlement

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1. Criteria Generation (Before Trading)

After market creation, the oracle generates or validates settlement criteria before the market becomes tradeable:
  • Resolvability gate — confirms whether the question is objectively answerable by the deadline
  • Authoritative sources — builds a list of official sources to check at settlement time (governing bodies, official accounts, price feeds)
  • Objective rubric — clarifies exact metrics, thresholds, and how to compute the outcome
Markets flagged as non-resolvable are filtered out and routed to refund paths. Only resolvable markets go live.

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2. Settlement (At/After Deadline)

When the market’s end time passes:
  • Time-bounded evidence — the oracle only considers information available up to the market’s deadline. No hindsight bias.
  • Source-checking — checks the pre-listed resolution sources first, extracts the numbers or facts that resolve the question
  • Explicit computation — shows the logic (totals, comparisons, thresholds), then decides YES or NO
  • Multi-provider consensus — multiple AI providers can be queried. If they agree, settlement proceeds with high confidence. If they conflict, authoritative sources take precedence.
  • Finalization — when decisive, the result is committed on-chain. When ambiguous or non-resolvable, a dispute/refund path is enabled.

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PNP DAO Settlement

Not every question fits neatly into structured evaluation. For markets that fall outside the oracle’s scope — subjective questions, edge cases, ambiguous outcomes, or situations where the oracle cannot reach a decisive answer — the PNP DAO steps in as the settlement backstop.

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How It Works

  • The oracle attempts settlement first using its standard two-step process
  • If the oracle returns an ambiguous or inconclusive result, the market is escalated to the DAO
  • PNP DAO members review the evidence and vote on the outcome
  • The DAO’s decision is final and committed on-chain

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Why a DAO Backstop?

  • Coverage — some questions are inherently subjective or context-dependent. An LLM can’t always adjudicate nuance.
  • Trust — human consensus as the final layer ensures no market goes unsettled indefinitely
  • Accountability — 20% of trading fees are allocated to the DAO, compensating members for the responsibility of being the last line of settlement
The DAO doesn’t replace the oracle — it catches what the oracle can’t. The vast majority of markets settle automatically. The DAO exists for the edge cases.

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Why This Oracle Works

  • Evidence-first — requires checking listed sources and extracting exact values, not just summarizing headlines
  • Time-bounded — date filters prevent leakage from after-deadline information
  • Source precedence — official databases and governing bodies outrank general reporting
  • Deterministic rubric — criteria define what counts, how to count it, and how to compare it before any decision is made
  • Multi-provider resilience — multiple AI providers reduce single-model bias; disagreements trigger safe fallbacks
  • DAO backstop — human consensus for edge cases the oracle can’t handle