# Stage 1: Decentralized Oracle Nodes

Once Polyquest reaches **100,000 meme coin holders**, the first stage of the **Prediction Oracle System** will be introduced. In this phase, individual users (meme coin holders) act as decentralized oracle nodes, observing, analyzing, and reporting real-world event outcomes.

## **How Stage 1 Works**

1. **Node Participation**
   * **Meme coin holders** act as nodes within the Polyquest Oracle system.
   * These users, based on their interaction with the real world, will report the outcome of specific events.
   * The reporting process is completely decentralized. Each node submits their observation by interacting with a dedicated smart contract, allowing multiple independent reports for each event.
2. **Collective Intelligence and Validation**
   * As more users report an outcome, the platform leverages **collective intelligence**, where a consensus is formed from the majority of responses. The more participants involved, the more accurate the reported outcome becomes, similar to how blockchain nodes validate transactions.
   * Polyquest itself, acting as a **validator**, does not resolve outcomes directly but can **initiate** or **deny** proposed resolutions to prevent manipulation.
3. **Node Rewards**
   * Oracle participants (nodes) who contribute accurate reports will be rewarded with **$POLY** tokens for their involvement in the outcome validation process.
   * Higher accuracy leads to greater rewards, incentivizing users to report truthfully.
4. **Decentralization & Transparency**
   * Every resolution proposed by the oracle nodes is fully transparent and recorded on-chain.
   * This ensures that all outcomes are auditable, tamper-proof, and viewable by anyone, solidifying trust in the system.