Who's Your Boromir?
"It is mad not to use it, to use the power of the Enemy against him."
You've got two colors of stones: red for bad, white for good (you can use stones of any two colors, but these are the examples used in the rules). If you draw red, the challenge fails. White, you succeed.
But before you draw for the outcome of the challenge, you draw to see the impact on the fellowship. Red means more trouble for the fellowship, white mean less. White/white is the best possible outcome: you win the challenge and the fellowship is unscathed. The worst? Red/red. You fail the challenge but instead of just losing a character, the fellowship faces BETRAYAL.
"I Trusted You!"
When one of our characters betrays the fellowship, they turn against us and our quest. They might sell out, cave in, or even think they're adhering to a higher purpose – that our quest is folly and they know what's best. Either way, they are now the enemy and they're out of the fellowship. Did their treachery cause us to fail the last challenge? It probably did.
When you draw red/red and have to decide who the traitor is, there might be an obvious suspect, but other times it might come as a complete surprise: you can't imagine that anyone in this team would turn against us. But it's our job as players to explain the outcome of the draw in a satisfying way. That can push the game into interesting territory we did not foresee. The team lawyer was a minor character, but he was a trusted friend and confident. We relied on him unthinkingly. But if it was all an act and he's in the pocket of the cartel, our whole world is turned upside down. And it's only the first challenge…
If you can't imagine any of your characters as traitors, there's another option: you can describe the fellowship betraying one of you instead. We leave someone behind, sacrifice them as a scapegoat, etc. At first glance this might seem like the softer choice but it's actually much worse. Instead of one bad apple, we're all guilty. And worst of all, it's not as easy to put behind us, because we carry the guilt with us.
In your whole quest, you might never draw a betrayal, just like you might never draw and lose a character (I'm lying – you will almost definitely lose characters).
But while the draw may require losses or betrayals, players can also voluntarily choose to have their characters get bumped off, leave the fellowship, or betray our quest whenever they want. That gives you the freedom to role-play your character however you want, even if that means turning against the quest you started off believing in…