A step-by-step guide to understanding and trading on prediction markets.
Markets are created around real-world events with clearly defined outcomes (e.g., YES or NO). Each market has a specific resolution date and criteria.
You buy shares based on your prediction. YES shares pay out if the event happens; NO shares pay out if it doesn't. Share prices range from $0.01 to $0.99, representing the market's implied probability.
As more people buy YES shares, the price goes up (higher implied probability). As more buy NO shares, the YES price goes down. You can sell your shares at any time at the current market price.
When the event occurs (or the deadline passes), the market resolves based on real-world data provided by oracles. The outcome is determined objectively using predefined criteria.
Winning shares are worth $1.00 each. Losing shares are worth $0. Your payout is automatically processed via smart contracts. You can claim your winnings from your portfolio.
• Share prices represent implied probability (e.g., $0.70 = 70% chance) • YES + NO prices always add up to approximately $1.00 • You profit when you buy low and the outcome matches your prediction • Fees include platform fees and network (gas) fees • Markets use on-chain orderbooks for transparent price discovery • Liquidity determines how easily you can buy/sell large amounts