To place your first prediction on Lightning Faucet: open Prediction Markets, pick a market that is still open, choose YES or NO, type an amount in sats (the minimum accepted stake is 10 sats), and confirm. The stake leaves your balance immediately, your position appears in your open positions list, and the market pays out automatically once the real world settles the question. There is no order book to work, no counterparty to find, and no separate deposit per market.
That is the whole flow. The part worth reading past this paragraph is what the number on the card actually means, because Lightning Faucet runs two different pricing engines behind the same YES/NO button, and the payout math is not the same in both. Bettors who lose money on a correct call almost always lost it by sizing a bet as if it were priced the other way. This guide is written by the team that operates the markets, so it describes the engine as it is implemented, not as a generic explainer imagines it.
What a Bitcoin prediction market is
A prediction market is a contract on a factual future event, priced by what people are willing to stake on each side. You take a position on a yes-or-no question ("will this event happen by this time"), and when the question resolves against an agreed data source, the correct side is paid from the money staked on the question. On Lightning Faucet every market is denominated in satoshis, settled from your site balance, and resolved by an external source rather than by an operator opinion.
The head term matters here: "betting on Bitcoin prediction markets" usually means one of two things, and we run both. Some markets are about Bitcoin (its price, mining difficulty, mempool fees). All of our markets are settled in Bitcoin. You can bet on an MMA fight and be paid in sats.
Step by step: your first position
1. Get sats into your balance
You need a funded balance before you can stake. Three routes work:
- Claim the faucet. The free spin credits sats straight to your balance on a claim timer, with no deposit at all. At a 10 sat minimum stake, a faucet claim is already enough to take a real position.
- Earn. The earn surfaces pay sats for tasks and offers, which land in the same balance.
- Deposit over Lightning. Request a deposit, scan the QR with any Lightning wallet, and the credit lands as soon as the invoice settles. Sat-denominated, usually seconds.
There is no separate wallet per product. The same balance funds a prediction, a poker seat, and a spin.
2. Open a market and read the close time
Every market card shows three timestamps that matter, and only one of them is the deadline for you: closes_at. Betting is rejected at the database level once the clock passes it, so there is no grace period and no "my click was in flight" appeal. For sports markets we set the close five minutes before the scheduled start, because line integrity collapses once the event is under way.
resolves_at is later, and is when we expect the outcome data to be available. The gap between close and resolve is normal and is not a delay in your payout.
3. Pick a side and size the stake
The floor is 10 sats on every market we run. The ceiling is not one number, and this is where new bettors get surprised. Three separate caps apply:
- Per-bet cap. Currently 25,000 sats on Bitcoin price, difficulty, mempool fee and weather markets, and up to 50,000 sats on sports markets.
- Per-user position cap. Your total active stake on a single market cannot exceed that same cap. Betting 20,000 sats on a 25,000 sat market leaves you 5,000 sats of room, not another 25,000. The rejection tells you exactly how much capacity you have left.
- Whole-market pool cap. Each market has a maximum total pool, typically 500,000 sats and up to 1,000,000 on the larger sports books. When the pool is full, no more stake goes in from anyone.
There is also a rate limit of ten bets per minute per account. It exists to stop scripted hammering of a market at close, and it returns a retry hint rather than losing your stake.
4. Confirm, then check your position
On confirmation the stake is debited and the market pools update in the same database transaction, under a row lock on the market. That is deliberate: it is what makes the pool number you saw and the pool number you bought into the same number. Your position then shows a projected payout, and the meaning of that projection depends on the engine.
The two engines behind one YES/NO button
This is the single most important thing to understand before you size a bet, and it is the thing a generic crypto explainer will not tell you, because most sites run only one of the two.
Parimutuel pool markets
Our Bitcoin price, mining difficulty, mempool fee and weather markets are parimutuel. There is no fixed price. Everyone's stake goes into a YES pool or a NO pool, and when the market resolves, the losing pool is distributed across the winning side in proportion to each winner's share of the winning pool. A 3% settlement fee is deducted from the total pool before winners split it.
The formula the engine actually applies is:
payout = floor( (your_stake / winning_pool) * (total_pool * 0.97) )Worked example. A market has 12,000 sats on YES and 8,000 sats on NO. You stake 1,000 sats on NO. The NO pool becomes 9,000 and the total becomes 21,000. NO resolves true. The distributable amount is 21,000 x 0.97 = 20,370 sats. Your share of the winning side is 1,000 / 9,000, so your payout is 2,263 sats: your stake back plus 1,263 sats of profit.
Two consequences that catch people out:
- Your price moves after you bet. The projected payout shown at confirmation is an estimate from the pools at that moment. If a wave of money follows you onto your own side, your share of the winning pool shrinks and your realised payout falls. Being early on a side that later becomes popular is worse for your payout than being early on a side that stays unpopular.
- The unpopular side pays more. In a parimutuel pool your win probability is not your own side's pool share, it is the other side's pool share, because the other side's money is what you win. That inversion is the most common reading error we see.
Fixed-odds sports markets
Sports markets are priced differently. They are fixed odds: the market card posts an offered percentage for each side, the house is the counterparty, and when you confirm, that percentage is locked into your bet row. The pool moving afterwards does not change what you are owed.
payout = floor( your_stake * 100 / locked_percentage )So a 1,000 sat stake at a posted 41.32% pays 2,420 sats if it wins, whether the market later fills with money on your side or drains off it. The projected payout on a fixed-odds position is a promise, not an estimate. That is the practical difference: on a sports market you can size against a known return; on a pool market you cannot.
Two operator details you should know because they will affect you at the moment you try to bet:
- We suspend rather than deal a stale line. Our lines refresh from a live odds feed. If a refresh finds no current price for an event (which happens on team news, scratches, and close to lock), we mark the line suspended and reject bets with an "odds are being updated" message. We do not keep dealing the last stored price. A rejection near lock is usually this, and it is protecting you as much as us.
- We never fall back to even money. If there is no valid price for the side you picked, the bet is refused outright rather than filled at a made-up number.
What happens at settlement
Resolution
At resolves_at the market moves to a resolving state, the outcome is pulled from the market's declared resolution source (a Bitcoin price feed for price markets, the odds and results feed for sports, chain data for difficulty and fee markets), payouts are computed, and winners are credited to their balance. Losing positions are marked lost. It is a cron-driven process, not a manual one, and it runs on a schedule rather than the instant the event ends.
Refunds: when nobody loses
This is a real and frequently missed feature. Some markets never pay out at all, and instead refund everyone:
- No real stake. If a market reaches resolution with no genuine user bets, it is cancelled and refunded.
- One-sided market. If every user stake landed on the same side of a pool market, there is nothing to win. Rather than hand out a token payout, we cancel and refund in full.
- Push or cancelled event. A tied result or a cancelled fixture resolves as a push. Full refunds.
Crucially, cancellations and pushes carry no settlement fee. Your stake comes back whole. If you have ever seen a position vanish and the exact stake reappear in your balance, that is what happened.
Taking sats off the site
Winnings sit in the same balance as everything else. To withdraw, use the LNURL-withdraw flow: the site shows a QR code or a link, you scan or tap it with your Lightning wallet, and the wallet fetches the invoice and pulls the payment automatically. You never have to generate an invoice by hand. The platform floor for a withdrawal is 100 sats.
The markets we actually run
Knowing what is on the board tells you where your edge in research can live.
Bitcoin price
Daily markets on whether BTC closes above or below a strike, resolved from a public price feed that we snapshot continuously rather than reading once at the deadline. That snapshotting is the reason a price market can resolve on a specific timestamp instead of on whatever value happened to be cached.
Mining difficulty
Markets on the direction and magnitude of the next difficulty adjustment. These are the most researchable markets we list: the adjustment is a deterministic function of block times inside the current epoch, and anyone can compute the projection mid-epoch. If you follow block intervals, this is where reading the chain beats reading sentiment.
Mempool fees
Markets on whether fees clear a threshold at a set time. Fee markets are mean-reverting and weekend-sensitive in ways that reward someone who actually watches the mempool.
Weather
Daily temperature and condition markets on a rotating set of cities, resolved from public meteorological data. Short-horizon weather is one of the few genuinely well-calibrated public forecasts on the internet, which makes these markets a good place to learn what "reading the number correctly" feels like.
Sports
The largest category by volume, spanning many leagues, with fixed-odds pricing and per-event lines. Because these are fixed odds, they behave the way a bettor's intuition expects, which is why we usually point newcomers here first.
Practical advice from operating the book
Check which engine you are on before sizing. If the card shows an offered percentage per side, you are on fixed odds and your return is locked. If it shows two pools, your return floats. Same button, different math.
On pool markets, look at the other side's pool. Then ask whether the money on the other side is informed. Weather and difficulty markets are the ones where a careful reader most often finds a pool that disagrees with the public data.
Do not save your stake for the last minute on sports. Late is exactly when a line is most likely to be suspended, and once closes_at passes there is no appeal.
Treat a refund as information, not a bug. A one-sided cancellation means nobody took the other side. If that keeps happening on a question you like, you are early to a market that has not found liquidity yet.
Sats are sats across the site. A prediction bankroll, a poker buy-in and a dice roll all draw on the same balance, so it is worth deciding in advance what portion of the balance is prediction money.
Start with 10 sats
The reason we set the floor at 10 sats is that prediction markets are learned by holding a position, not by reading about one. Claim the faucet, open the board, take a small position on a weather or difficulty market where the underlying data is public, and watch how the pool moves against your projected payout between the moment you bet and the moment it closes. One resolved position teaches more than any amount of theory.
When you are ready, the board is at Prediction Markets.
Written by the Lightning Faucet team.