Aliquando vincimus, aliquando amittimus. fascinated by prediction markets
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Joined June 2025
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Zero fees on 12 games today, seems like a nice offer
but have you asked who is paying?
@Polymarket does, but as marketing, think of black friday but for prediction markets
upside? they give up the fee hoping new users stick around and keep trading
they're betting it's small compared to what they'll earn.
tho you should know this:
⤷ your spread isn't free
⤷ gas is a separate cost, and it stays tiny because orders are matched offchain
so yeah zero fees isn't zero cost
now you know :)
Bruce 🩺 retweeted
Worth adding: YES and NO share one book there. Say a 40¢ YES bid meets a 60¢ NO bid; they match by minting a fresh pair.
That's why a 17 Oct scan of 49,134 Polymarket markets found zero YES+NO gaps. What's left sits in multi-outcome sets: 166 flagged, 3 held up.
now the ballondor over and everywhere is calm
let's explain what happens what and why prediction markets combine an order book and an AMM
this is called a hybrid and prediction markets use the word hybrid for completely different things, let me clear it up
⤷ why some prediction markets use hybrids:
a brand new market has no traders, and an order book with no orders is empty, so there's no price to see and nothing to trade against
most new users would take one look and leave
an AMM fixes that, because a pool and a formula always quote a price
⤷ but AMMs have their own problem, as explained in the quoted post
and since an AMM only moves when someone trades, its price can stayput while the real world changes
so why not combine both?, let's look into AMMs and Order books
the core idea?
⤷ use each one where it's strong
for a new prediction market, the AMM posts quotes inside the order book, e.g a buy at 49c and a sell at 51c.
the first visitor sees a real price and can trade.
As real traders show up, they post their own orders, often at better prices
they compete with the AMM, and once the book is deep, the AMM becomes a backup that refills the book when orders run out
making sure the AMM fixes the empty book problem, and the order book fixes the slippage problem
but now big prediction markets like @Kalshi and @Polymarket each use another hybrid style
for @Polymarket orders are matched off chain by a fast backend, like a normal exchange
Placing or cancelling an order costs no gas fee, that's why you hear things like "zero gas fees"
the final swap of shares and money settles on chain on Polygon, so it's transparent and you keep custody of your funds
But why not do everything on chain?
⤷ a blockchain is too slow and expensive for every order and cancellation, it's great for final settlement, not for constant trades
one problem about this tho is what we call ghost fills (will explain in another post)
@Kalshi runs a fully centralized order book, so every trade and settlement is done by the company themselves
the problem about this? the orders might be matched wrongly or resolved poorly
the good thing is that it's CFTC regulated basically customer protection, so it would be hard to rig
so the next time you see a prediction market, ask two questions
⤷ how does it set prices?
⤷ and where does it settle?
the answers will tell you more about the risks than the odds do
which type of hybrid did you already know about?
Bruce 🩺 retweeted
pretty sure at least one time you tried to trade on a prediction market, you entered at 50c but it moved you to 60c
the mechanics behind that is simple and you will learn something from this :)
we have two systems that run the buy and sell of a prediction market
⤷ Orderbooks
⤷ AMMs ( automated market makers )
now, what's the difference and which one is better? let's go through each starting with order books
in order books, buyers post the price they'll pay (bids), sellers post the price they'll accept (asks)
a trade happens only when the two meet example, the cheapest seller wants 53c and the best buyer offers 52c
someone has to cross the gap, because those two don't meet and that what costs you :)
that 1 cent gap is the spread, that spread is the hidden cost of trading
now for the part most people miss, the size of your trade also matters
say 800 shares are for sale at 53c, then 500 at 54c, then 300 at 55c
buy 1,000 shares with a market order and 800 fill at 53 cents ($424), then 200 at 54 cents ($108).
what you paid $532, an average of 53.2 cents, not the 53 you saw.
that gap between the price you saw and what it gave you is slippage, and a thin order book makes it worse.
imagine moving from 53 to 63c because of a market order, that's what happens on a very thin order book
the fix? a limit order. you name your price and wait.
the bad part? your trade might partly fill or never fill :) and this order book is bad for start up prediction markets
now for automated market makers (AMMs)
this system is good for startup prediction markets and markets with thin or low liquidity
now how does an amm work?
you have to pay very very close attention to this particular line below
there's a pool of YES and NO shares plus a formula sets the price, so you can always trade, whether there's another human or not
the bigger the pool, the less price impact
let's start with 1,000 YES and 1,000 NO in the pool
each yes costs 50 cents, now someone spends $100 on YES.
the formula is simple, YES times NO has to be constant, so the price has to climb.
(this formula is common but some other companies use the LMSR, a different version)
the price of YES = NO in pool ÷ (YES + NO) = 1,000 ÷ 2,000 = 50c.
since you spent $100 on YES:
your $100 creates 100 YES and 100 NO.
the pool keeps the new NO, so it now has 1,100 NO
The rule is that YES × NO stays at 1,000,000 because 1000 x 1000 is 1million
because of this the pool's YES drops to 1,000,000 ÷ 1,100 = 909.09
you then receive your 100 YES plus the 90.91 the pool gave up equalling 190.91 shares
your average price is now (remember that formula above) 100 ÷ 190.91 = 52.4c.
The new price: 1,100 ÷ (909.09 + 1,100) = 54.75c.
So your own trade moved the price from 50c to 54.75c, and you entered at 52.4c
now you might be thinking, let me spend 500 instead:
now NO becomes 1,500, YES becomes 666.67, and you get 833.33 shares at an average of 60c
the price jumps to about 69.2c, a very huge slippage from the beginning.
Now let's use a bigger pool, 10,000 each, and you spend $100
now you get about 199.01 shares at an average of 50.25c.
the same trade barely moves the price, because the higher the pool, the less price impact it will have :)
Bruce 🩺 retweeted
Hey Aster 👋
You said you love motion designers who scale with AI, here are some of my motion designs in the past month using Opus5.5
We're looking for a part-time Motion Designer at Aster.
First, we love AI.
We actually hope you're better at using it than anyone on our team. Go wild. Just know where AI falls short and when your taste tells you to step in.
Second, we think motion design is partly psychology.
Why does one 30-second video make you want to watch it twice, while another loses you in two seconds? And how do you make it look great without losing the point?
now the ballondor over and everywhere is calm
let's explain what happens what and why prediction markets combine an order book and an AMM
this is called a hybrid and prediction markets use the word hybrid for completely different things, let me clear it up
⤷ why some prediction markets use hybrids:
a brand new market has no traders, and an order book with no orders is empty, so there's no price to see and nothing to trade against
most new users would take one look and leave
an AMM fixes that, because a pool and a formula always quote a price
⤷ but AMMs have their own problem, as explained in the quoted post
and since an AMM only moves when someone trades, its price can stayput while the real world changes
so why not combine both?, let's look into AMMs and Order books
the core idea?
⤷ use each one where it's strong
for a new prediction market, the AMM posts quotes inside the order book, e.g a buy at 49c and a sell at 51c.
the first visitor sees a real price and can trade.
As real traders show up, they post their own orders, often at better prices
they compete with the AMM, and once the book is deep, the AMM becomes a backup that refills the book when orders run out
making sure the AMM fixes the empty book problem, and the order book fixes the slippage problem
but now big prediction markets like @Kalshi and @Polymarket each use another hybrid style
for @Polymarket orders are matched off chain by a fast backend, like a normal exchange
Placing or cancelling an order costs no gas fee, that's why you hear things like "zero gas fees"
the final swap of shares and money settles on chain on Polygon, so it's transparent and you keep custody of your funds
But why not do everything on chain?
⤷ a blockchain is too slow and expensive for every order and cancellation, it's great for final settlement, not for constant trades
one problem about this tho is what we call ghost fills (will explain in another post)
@Kalshi runs a fully centralized order book, so every trade and settlement is done by the company themselves
the problem about this? the orders might be matched wrongly or resolved poorly
the good thing is that it's CFTC regulated basically customer protection, so it would be hard to rig
so the next time you see a prediction market, ask two questions
⤷ how does it set prices?
⤷ and where does it settle?
the answers will tell you more about the risks than the odds do
which type of hybrid did you already know about?
pretty sure at least one time you tried to trade on a prediction market, you entered at 50c but it moved you to 60c
the mechanics behind that is simple and you will learn something from this :)
we have two systems that run the buy and sell of a prediction market
⤷ Orderbooks
⤷ AMMs ( automated market makers )
now, what's the difference and which one is better? let's go through each starting with order books
in order books, buyers post the price they'll pay (bids), sellers post the price they'll accept (asks)
a trade happens only when the two meet example, the cheapest seller wants 53c and the best buyer offers 52c
someone has to cross the gap, because those two don't meet and that what costs you :)
that 1 cent gap is the spread, that spread is the hidden cost of trading
now for the part most people miss, the size of your trade also matters
say 800 shares are for sale at 53c, then 500 at 54c, then 300 at 55c
buy 1,000 shares with a market order and 800 fill at 53 cents ($424), then 200 at 54 cents ($108).
what you paid $532, an average of 53.2 cents, not the 53 you saw.
that gap between the price you saw and what it gave you is slippage, and a thin order book makes it worse.
imagine moving from 53 to 63c because of a market order, that's what happens on a very thin order book
the fix? a limit order. you name your price and wait.
the bad part? your trade might partly fill or never fill :) and this order book is bad for start up prediction markets
now for automated market makers (AMMs)
this system is good for startup prediction markets and markets with thin or low liquidity
now how does an amm work?
you have to pay very very close attention to this particular line below
there's a pool of YES and NO shares plus a formula sets the price, so you can always trade, whether there's another human or not
the bigger the pool, the less price impact
let's start with 1,000 YES and 1,000 NO in the pool
each yes costs 50 cents, now someone spends $100 on YES.
the formula is simple, YES times NO has to be constant, so the price has to climb.
(this formula is common but some other companies use the LMSR, a different version)
the price of YES = NO in pool ÷ (YES + NO) = 1,000 ÷ 2,000 = 50c.
since you spent $100 on YES:
your $100 creates 100 YES and 100 NO.
the pool keeps the new NO, so it now has 1,100 NO
The rule is that YES × NO stays at 1,000,000 because 1000 x 1000 is 1million
because of this the pool's YES drops to 1,000,000 ÷ 1,100 = 909.09
you then receive your 100 YES plus the 90.91 the pool gave up equalling 190.91 shares
your average price is now (remember that formula above) 100 ÷ 190.91 = 52.4c.
The new price: 1,100 ÷ (909.09 + 1,100) = 54.75c.
So your own trade moved the price from 50c to 54.75c, and you entered at 52.4c
now you might be thinking, let me spend 500 instead:
now NO becomes 1,500, YES becomes 666.67, and you get 833.33 shares at an average of 60c
the price jumps to about 69.2c, a very huge slippage from the beginning.
Now let's use a bigger pool, 10,000 each, and you spend $100
now you get about 199.01 shares at an average of 50.25c.
the same trade barely moves the price, because the higher the pool, the less price impact it will have :)
we need more prediction market content on the timeline.
will do what I can to be part of the growing movement tho
Bruce 🩺 retweeted
Do you want to eat healthy and still get rewarded for it?
Use @EmoryaApp , an AI app that tells you how many calories are in your meal, tracks your activities and also reward you.
Who said eating healthy has to be boring? 😏
#emoryafoodscan
Bruce 🩺 retweeted
$10,000 IS UP FOR GRABS
Crazy right?
Don’t just watch from the sidelines GET IN THE GAME!
Climb the leaderboard, make your moves, and put yourself in the running to win big!
Your shot at $10K starts NOW! Are you ready to claim your spot?
#Halloween #Donbet
pretty sure at least one time you tried to trade on a prediction market, you entered at 50c but it moved you to 60c
the mechanics behind that is simple and you will learn something from this :)
we have two systems that run the buy and sell of a prediction market
⤷ Orderbooks
⤷ AMMs ( automated market makers )
now, what's the difference and which one is better? let's go through each starting with order books
in order books, buyers post the price they'll pay (bids), sellers post the price they'll accept (asks)
a trade happens only when the two meet example, the cheapest seller wants 53c and the best buyer offers 52c
someone has to cross the gap, because those two don't meet and that what costs you :)
that 1 cent gap is the spread, that spread is the hidden cost of trading
now for the part most people miss, the size of your trade also matters
say 800 shares are for sale at 53c, then 500 at 54c, then 300 at 55c
buy 1,000 shares with a market order and 800 fill at 53 cents ($424), then 200 at 54 cents ($108).
what you paid $532, an average of 53.2 cents, not the 53 you saw.
that gap between the price you saw and what it gave you is slippage, and a thin order book makes it worse.
imagine moving from 53 to 63c because of a market order, that's what happens on a very thin order book
the fix? a limit order. you name your price and wait.
the bad part? your trade might partly fill or never fill :) and this order book is bad for start up prediction markets
now for automated market makers (AMMs)
this system is good for startup prediction markets and markets with thin or low liquidity
now how does an amm work?
you have to pay very very close attention to this particular line below
there's a pool of YES and NO shares plus a formula sets the price, so you can always trade, whether there's another human or not
the bigger the pool, the less price impact
let's start with 1,000 YES and 1,000 NO in the pool
each yes costs 50 cents, now someone spends $100 on YES.
the formula is simple, YES times NO has to be constant, so the price has to climb.
(this formula is common but some other companies use the LMSR, a different version)
the price of YES = NO in pool ÷ (YES + NO) = 1,000 ÷ 2,000 = 50c.
since you spent $100 on YES:
your $100 creates 100 YES and 100 NO.
the pool keeps the new NO, so it now has 1,100 NO
The rule is that YES × NO stays at 1,000,000 because 1000 x 1000 is 1million
because of this the pool's YES drops to 1,000,000 ÷ 1,100 = 909.09
you then receive your 100 YES plus the 90.91 the pool gave up equalling 190.91 shares
your average price is now (remember that formula above) 100 ÷ 190.91 = 52.4c.
The new price: 1,100 ÷ (909.09 + 1,100) = 54.75c.
So your own trade moved the price from 50c to 54.75c, and you entered at 52.4c
now you might be thinking, let me spend 500 instead:
now NO becomes 1,500, YES becomes 666.67, and you get 833.33 shares at an average of 60c
the price jumps to about 69.2c, a very huge slippage from the beginning.
Now let's use a bigger pool, 10,000 each, and you spend $100
now you get about 199.01 shares at an average of 50.25c.
the same trade barely moves the price, because the higher the pool, the less price impact it will have :)
Bruce 🩺 retweeted
Giveaway 🎉 Win 500 USDc: 10 lucky winners to share $50 each.
To join: ☑️ Follow @YeNoMarkets , like & RT ☑️ Tag 3 friends👥
☑️ Comment the answer
Terms and eligibility apply. Never share your wallet’s private keys or seed phrase.
A company saw what I was posting about prediction markets and reached out to me via dm
they gave me $10 in free trading credit to try their site and i hopped in cause why not :)
that company is @futuurHQ and here's the breakdown:
they gave me a coupon for $10 but I had to get 5 markets resolved to withdraw the bonus and any profits i made on it
so i went in and placed small bets on their sports market because it was a UCL day and watched them resolve one by one
Out of the 5 bets, I won 3 (I hate sporting till this day 😂)
I ended with $9.73 from the $10
⤷ what I liked about the site
how easy it was to start, and find markets
plus one thing I love to point is their demo feature, where you can use ohms to test around before entering the real deal :)
⤷ what I'd improve is the resolution time, the ucl bets took a while to resolve and if they could make it quicker to resolve, that would be a massive upgrade
But honestly?, i love the tech and it is very soon reaching the levels of top prediction markets :)
see you next time frens, goodnight
🤝 Paid partnership
Bruce 🩺 retweeted
CRYPTO EXCHANGES ARE FOLLOWING THE MONEY
BinanceUS is reportedly seeking approval to enter prediction markets
Blockchain com is moving in too
meanwhile, Polymarket and Kalshi went from $17B to $72B in combined monthly trading volume in just 8 months
even crypto exchanges want a piece of this market now
can they actually compete with Polymarket?
Trump might be impeached again if the Democrats win both house and senate
in his words "they will find a way to impeach me"
prediction market odds are showing up in midterm coverage everywhere, on some Democrats to win the house is 90c, while to win senate is 65c
that raises a question most people skip: can money fake momentum?
here's the loop:
⤷a big trade can move a candidate's odds and then media or social posts turn that move into a headline
"candidate X is surging."
people see the story and read it as a signal about who's winning, that could nudge perception, even if nothing changed in the race itself.
this is a real concern concerning the elections, a reporter covering the topic noted that in a thin market, a large trade or coordinated buying can lift a candidate's odds even when little has changed.
economists say the risk is bigger in small races with low volume, while big national markets are harder to push around.
there's a counterpoint worth knowing. Moving the price costs real money, because the manipulator pays for every cent of it.
Looking at past research on election markets found that suspicious price spikes often reverted within hours.
and in 2024, a large trade on @Polymarket by a french investor sparked manipulation theories, but there was little reason to think that was the motive.
so before you quote midterm odds, check how much volume sits behind them. a 70% on a market with millions traded means way more than 70% on a market with a few thousand :)
Bruce 🩺 retweeted
“We launched Base not really knowing what to expect”
“As I reflect back the thing that I felt is wow this is beautiful”
@jessepollak says on the stream with Nibel