How Prediction Markets Work
Parimutuel betting on BTC price outcomes with fair, transparent resolution
How It Works
Parimutuel Betting
Prediction markets use a parimutuel model — you bet against other players, not against the house. Every market has a simple YES or NO outcome based on BTC price.
Each market asks a question like "Will BTC be at or above $85,000 at midnight UTC on March 7?" Browse open markets and pick one you want to trade.
If you think BTC will meet or exceed the threshold, bet YES. If you think it won't, bet NO. Your sats go into a shared pool with all other bets.
At the resolution time (typically midnight UTC), the BTC price is checked automatically. The outcome is determined — either YES wins or NO wins.
If your side wins, you share the entire pool (minus a small rake) proportional to your bet size. Winnings are credited to your balance instantly.
How Markets Resolve
BTC Price Source
All BTC price markets resolve using CoinGecko price data. We snapshot BTC prices every 5 minutes throughout the day, creating a verifiable audit trail.
Resolution Logic
At the market's resolution time (midnight UTC for daily markets):
- The BTC price is fetched from CoinGecko
- If BTC is at or above the threshold price → outcome is YES
- If BTC is below the threshold price → outcome is NO
- Resolution is fully automated — no manual intervention
Edge Cases
- One-sided markets: If only YES or only NO bets exist, the market is cancelled and all bets are fully refunded. No rake is taken.
- Cancelled markets: If a market is cancelled for any reason, all bets are fully refunded. No rake is taken.
- Price data unavailable: If CoinGecko data cannot be fetched at resolution time, the system retries until data is available.
Payouts
How Winnings Are Calculated
Winners share the total pool minus the 3% rake, proportional to their bet size on the winning side.
your_payout = (your_bet / winning_side_pool) × (total_pool × 0.97)
Worked Example
Suppose a market has:
- YES pool: 1,000 sats (you bet 200 of these)
- NO pool: 500 sats
- Total pool: 1,500 sats
If the outcome is YES:
- Pool after 3% rake: 1,500 × 0.97 = 1,455 sats
- Your share: (200 / 1,000) × 1,455 = 291 sats
- Your profit: 291 − 200 = +91 sats
If the outcome is NO, you lose your 200 sat bet.
How Odds Work
Dynamic Pool-Based Odds
Odds are determined by the ratio of YES to NO bets in the pool. As more bets come in, the odds shift in real time.
- If most of the money is on YES, YES odds decrease and NO odds increase
- If the pools are balanced (50/50), both sides have similar odds
- The odds bar on each market shows the current pool distribution
Early Bets Get Better Odds
If you bet early when your side's pool is small and more money comes in on the opposite side after you, your potential payout improves. The payout calculator on each market shows your exact potential payout before you place your bet.
Betting Limits
Graduated Max Bet
To prevent last-second sniping, the maximum bet decreases as a market approaches its close time:
- More than 2 hours before close: 100% — full max bet (25,000 sats)
- 1–2 hours: 50% (12,500 sats)
- 30 min – 1 hour: 25% (6,250 sats)
- 10–30 minutes: 10% (2,500 sats)
- 5–10 minutes: 5% (1,250 sats)
- 1–5 minutes: 2% (500 sats)
- Under 1 minute: minimum bet only (10 sats)
The current effective maximum is shown on the bet form when it differs from the base limit.
Per-Player Position Cap
To keep markets fair, each player’s total bets on a single market are capped at 25,000 sats. You can place multiple bets as odds change, but your combined position cannot exceed this limit. The bet form shows your current position and remaining capacity.
Pool Limits
- Maximum pool size: 500,000 sats per market
- Multiple bets: You can place multiple bets on the same market, even on different sides
- Your total position per market is capped at 25,000 sats across all bets