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 :)

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

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 :)

exactly what we have been trying to say for the past 7 years since prediction markets came about in casinos or sport books you are competing against the house, but in prediction markets you are competing against other humans and what their predictions are :) ⤷ now see this video

Someone just risked 1000$ to win 0.8$ reward retarded right? but that's the work of the proposer. yesterday I explained how UMA voting works now, let's look into UMA voting and whether it's actually fair or not ⤷ using the instance quoted: in theory it's clean and simple voters stake tokens, vote in secret, and get punished if they land in the minority. the idea is that honest voters win because they all point at the same truth, I mean if you lie you are most likely to fall in the minority but what happens if someone buys the majority, because voting power equals tokens staked and that creates a teeny tiny problem :) let's look at a real example: in March 2025, a polymarket market asked whether Ukraine would agree to a mineral deal with the US it had about $7 million in trading volume. No deal had been agreed, yet the market resolved yes, then it was disputed and reached the voting stage Now here's the interesting part: ⤷ reports said a single large UMA holder cast about 5 million tokens across three accounts, roughly 25% of the votes casted @Polymarket then admitted the market resolved against its own clarification and what users expected, they called it a "situation" but they didn't refund :) ⤷ later, the Zelenskyy suit market drew similar complaints, analysts noticed that a handful of wallets held a big share of the vote. UMA's cofounder said that there is no evidence of manipulation. whether anyone cheated or not, a system where a few holders can swing the outcome is hard to fully trust, especially when the same people could also trade on the market. that's the problem with UMA voting. and that's how @Polymarket resolves their market as against @Kalshi who resolves everything in their company explaining Kalshi resolution system tomorrow :)