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Markets
What is an information market?
An information market is where people buy and sell shares on how a future event will resolve. Prices change in response to trading activity. You can buy, trade, or sell shares in future outcomes.
Who sets the probabilities on a market?
The prices of shares in each market reflect the probabilities of the outcomes. Shares are valued between $0.00 and $1.00 and prices change depending on traders’ collective beliefs on the likelihood of the market resolving in either direction. For instance, if the price for a “Yes” share is $0.75, then the market believes the probability that the event will occur is 75%.
What are the different types of markets?
There are 3 types of markets that currently exist:
- Binary - A market with two options that will resolve either $1 or $0. (ex: Will Tetranode have over 100k Twitter followers by 12/31/2025? YES/NO)
- Categorical - A market with multiple options that will resolve either $1 or $0. (ex: What ice cream will have the most sales in 2025? Chocolate/Vanilla/Strawberry/Other)
- Scalar - A market that resolves to where the final value sits between a lower and upper bound.
- What will the population of Spain be in their upcoming census (47M-55M)? Long/Short)
- If the population is 50M, the outcomes will resolve to: Long = $0.375 & Short = $0.625
I have a great idea for a market. Do you take suggestions?
Our community is always open to ideas! Check out our Discord and explain your idea on the “formal-market-suggestions” channel.
Last modified 2mo ago