How do prediction markets work on Lightning Faucet?

Prediction markets come in two models. Parimutuel markets pool player bets — you bet against other players. Fixed-odds markets (most sports markets) quote a payout multiplier when you bet, and the house takes the other side. Every market has a YES or NO outcome. You pick a side, place your bet, and if your side wins you are paid out — from the shared pool (minus a 3% rake) on parimutuel markets, or stake × the locked multiplier on fixed-odds markets. Winnings are credited instantly via the Lightning Network.

How are prediction markets resolved?

Each market type uses a trusted oracle: BTC price markets use CoinGecko, sports markets use The Odds API, weather markets use Open-Meteo, and Bitcoin network markets (difficulty, mempool fees) use mempool.space. Resolution is fully automated with no manual intervention.

How are prediction market payouts calculated?

Winners share the total pool minus a 3% rake, proportional to their bet size. Formula: your_payout = (your_bet / winning_side_pool) × (total_pool × 0.97). If only one side has bets or the market is cancelled, all bets are fully refunded with no rake.

What are the betting limits on prediction markets?

The minimum bet is 10 sats. The maximum is 25,000 sats per bet on standard markets and 50,000 sats per bet on fixed-odds sports markets. To prevent last-second sniping, the max bet decreases as a market approaches close time. Each player's total position on a single market is capped at the same maximum for that market type.

How do odds work in prediction markets?

Odds are determined by the ratio of YES to NO bets in the pool. As more bets come in, odds shift in real time. Early bets can get better odds if the pool shifts afterward. Important: odds can change after you bet — your payout depends on final pool sizes at resolution, not the odds when you placed your bet.

How Prediction Markets Work | Lightning Faucet

How It Works

Parimutuel Betting

Parimutuel markets use a shared-pool model — you bet against other players, not against the house. Every market has a simple YES or NO outcome based on real-world data: BTC price, sports scores, weather conditions, or Bitcoin network metrics.

1

Choose a market

Browse open markets across different categories — BTC price, sports, weather, and more. Each market asks a question with a YES or NO outcome.

2

Pick YES or NO

If you think the outcome will happen, bet YES. If you think it won't, bet NO. Your sats go into a shared pool with all other bets.

3

Wait for resolution

At the resolution time, the outcome is checked automatically using a trusted oracle. Either YES wins or NO wins — no manual intervention.

4

Collect your winnings

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.

Key concept (parimutuel markets): The house doesn't take a position. All bets go into a shared pool, and winners split the losers' money. The house only takes a small 3% rake from the total pool.

Fixed-Odds Markets

Most sports markets use fixed odds instead of a shared pool. There is no pool to split: the house takes the other side of your bet.

Locked multiplier: the payout multiplier (for example “pays 2.40x”) is shown on the bet form and locked in when you place your bet. Later odds changes don't affect it.
Payout: if you win, you receive your stake × the locked multiplier. If you lose, you lose your stake.
Built-in margin: the house margin is already included in the quoted multiplier. No separate 3% rake applies.
Limits: the minimum bet is 10 sats and the maximum is 50,000 sats per bet (see Limits). The graduated max bet still applies near close. Any sats shown on a fixed-odds market are house liquidity, not player bets, so these markets don't display a pool size.

Market Types

BTC Price Markets

Daily markets on whether Bitcoin will close above or below a target price.

Schedule: New markets created daily, resolve at midnight UTC
Betting closes: before resolution — currently 30 minutes ahead, so 23:30 UTC for a market resolving at midnight UTC, though that lead time is a site setting and can change. The market question is worded against the resolution time, not the betting cutoff, so the close time shown above the bet form is the one that counts — check it before you leave a position to the last minute.
Oracle: CoinGecko
Resolution: If BTC is at or above the threshold at resolution time → YES wins. We snapshot the price every 5 minutes so resolution reads a stored value rather than one live lookup. That 5-minute cadence is the oracle record, not the betting cutoff.

Sports Markets

Bet on NBA, NHL, MLB, EPL, and MLS game outcomes.

Available leagues: MLB, NBA, NHL, MLS, EPL, Champions League, Brasileirão, MMA (NFL and College Football from September 2026)
Betting closes: 5 minutes before the scheduled start. Line integrity collapses once an event is under way.
Oracle: The Odds API
Resolution: Based on official final scores
Edge cases: A drawn match settles as NO (the named side did not win). Knockout ties decided on penalties are resolved manually to the side that advanced. Markets are cancelled and bets refunded if the game is postponed or no score is available within 24 hours

Weather Markets

Daily temperature and precipitation markets for major US cities.

Cities: New York, Los Angeles, Miami
Oracle: Open-Meteo (free open-source weather API)
Temperature markets: Resolve based on the official recorded daily high
Rain markets: Resolve YES for any precipitation above 0.25mm

Mempool Fee Markets

Weekly markets on whether median Bitcoin transaction fees will exceed a threshold.

Schedule: Created on Mondays, resolve on Sunday
Oracle: mempool.space
Resolution: YES if median fee exceeds the specified sat/vB threshold during the week

Resolution info: Every market shows a "How is this resolved?" link in its detail view, displaying the exact oracle and resolution method used for that specific market.

How Markets Resolve

Oracle Sources

Each market type resolves using a trusted third-party oracle. Resolution is fully automated with no manual intervention.

Market Type	Oracle	Resolution Method
BTC Price	CoinGecko	Price snapshot at resolution time (midnight UTC)
Sports	The Odds API	Official final scores after game completion
Weather	Open-Meteo	Recorded daily high temperature or precipitation data
Mempool Fees	mempool.space	Median fee data over the market period

Resolution Logic

At each market's resolution time, the oracle data is fetched automatically:

If the condition is met (price above threshold, team wins, rain recorded, etc.) → outcome is YES
If the condition is not met → 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 (e.g. postponed sports game, unavailable data), all bets are fully refunded.
Data unavailable: If oracle data cannot be fetched at resolution time, the system retries until data is available.

Transparency: Each market's detail view shows a "How is this resolved?" link with the exact oracle and resolution method. BTC price snapshots are stored every 5 minutes for verification.

Payouts

How Winnings Are Calculated

Parimutuel markets: winners share the total pool minus the 3% rake, proportional to their bet size on the winning side. Fixed-odds markets: a winning bet pays your stake × the multiplier locked when you bet.

                        Formula:

                        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.

House Rake (parimutuel markets)

3%

Taken from the total pool on resolution of parimutuel markets. No rake on cancelled or one-sided markets. Fixed-odds markets have the margin built into the quoted multiplier instead.

How Odds Work

Dynamic Pool-Based Odds

On parimutuel markets, 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.

Important: Odds can change after you bet. Your payout depends on the final pool sizes at resolution time, not the odds when you placed your bet. The pre-bet calculator shows what you'd win if the pools stayed the same.

Betting Limits

Minimum Bet

10 sats

Maximum Bet

25,000 sats

50,000 sats on fixed-odds sports markets

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)

Amounts above are for standard markets (25,000 sat base limit). Fixed-odds sports markets use the same percentages of their 50,000 sat base limit. 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 on standard markets and 50,000 sats on fixed-odds sports markets. 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 (50,000 sats on fixed-odds sports markets) across all bets