The mechanic
How it works
Four steps, and the third is the one that makes it different from a bet with a bookmaker.
- 01
Take a side
OVER or UNDER on where the price finishes against the line, in one hour or twenty-four.
- 02
Watch the pool build
The odds are only how the crowd has split its money so far. They move as new stakes land on either side.
- 03
No curve, no slippage
Both sides pay into one pot and the winning side splits the whole thing. There is nothing to trade against, so your own stake cannot move the price on you.
- 04
The feed calls it
At expiry the price feed decides, on chain. No mod, no dispute, no admin override. If a feed goes quiet past the grace period the market voids.
Why it is built this way
Three decisions
Pari-mutuel, not an order book
A binary market with a curve punishes whoever is right early, because their own size moves the odds against them. A pot does not.
Settled by a feed, not a person
The market re-reads its price feed at expiry rather than trusting whatever number was on screen. That is the whole difference between a market and a promise.
Nothing to keep running
A market is opened by its first staker, settlement rides along with the first winning claim, and everyone pays their own gas. No keeper to fund, no subsidy to run out of.
The maths
What a stake pays
Both sides pay into one pot. The winning side splits the whole thing by share, less a fee taken only from the losing side.
payout = (yourStake / winningPool) x (winningPool + losingPool - fee) fee = losingPool x 2% // a worked example winningPool = 6.0 losingPool = 4.0 yourStake = 0.5 fee = 4.0 x 2% = 0.08 payout = (0.5 / 6.0) x (6.0 + 4.0 - 0.08) = 0.827 profit = 0.327 on a 0.5 stake
Settles on Robinhood Chain. The full rules, including what happens when a feed is quiet, are in the docs.