Prediction markets are coming to dYdX Chain thanks to an integration with Polymarket software!
Let’s take a look at our latest feature drop.
What is Polymarket?
Polymarket is a prediction market platform where users can bet on the outcomes of certain real world events. Each market has a “yes” and “no” bet and users can buy whichever side of the bet they think will win. At the end of each event, the market settles to $1 or $0.
For example, for the Simone Biles Wins All Around Gold market users could buy either the Yes or No share. Since Biles did win all around gold, every Yes share became $1 and every No share became $0. The buy price of each share before settlement is determined by a simple supply and demand model.
The Limit with Polymarket
While Polymarket opens the door to a whole new way to speculate on real world events, upside is capped. Users can only sell each share for a maximum of $1. While upside could be huge for users who buy the share at $0.01, it doesn’t create a huge opportunity for people with conviction when a market is saturated.
In comes dYdX Prediction Markets
Prediction markets on dYdX allows users to list and trade eligible Polymarket prediction markets on dYdX Chain which meet sufficient liquidity and technical compatibility requirements.Users can now long or short a market with up to 20x leverage, creating the opportunity for bigger upside (or bigger loss).
dYdX Chain prediction markets will only track the asset price for the Yes share for any market. This is because longing a market acts as a Yes bet while shorting a market acts as a No bet.
The software will only support prediction markets on isolated margin and with a maximum of 20x leverage for now. Traders on any community deployment can propose to launch a prediction market in the new market widget shown in the front-end interface.
Our vision is to make dYdX Chain software as robust as possible and to build the dYdX Chain to be the one-stop shop for all types of on-and-offchain markets. This integration with Polymarket software is dYdX Chain’s first foray into new asset types and we’re super excited to see how it goes!
Legitimacy and Disclaimer
Crypto-assets can be highly volatile and trading crypto-assets involves risk of loss, particularly when using leverage. Investment into crypto-assets may not be regulated and may not be adequate for retail investors. Do your own research and due diligence before engaging in any activity involving crypto-assets.
dYdX is a decentralised, disintermediated and permissionless protocol, and is not available in the U.S. or to U.S. persons as well as in other restricted jurisdictions. The dYdX Foundation does not operate or participate in the operation of any component of the dYdX Chain’s infrastructure.
The dYdX Foundation’s purpose is to support the current implementation and any future implementations of the dYdX protocol and to foster community-driven growth in the dYdX ecosystem.
The dYdX Chain software is open-source software to be used or implemented by any party in accordance with the applicable license. At no time should the dYdX Chain and/or its software or related components be deemed to be a product or service provided or made available in any way by the dYdX Foundation. Interactions with the dYdX Chain software or any implementation thereof are permissionless and disintermediated, subject to the terms of the applicable licenses and code. Users who interact with the dYdX Chain software (or any implementations thereof) will not be interacting with the dYdX Foundation in any way whatsoever. The dYdX Foundation does not make any representations, warranties or covenants in connection with the dYdX Chain software (or any implementations and/or components thereof), including (without limitation) with regard to their technical properties or performance, as well as their actual or potential usefulness or suitability for any particular purpose, and users agree to rely on the dYdX Chain software (or any implementations and/or components thereof) “AS IS, WHERE IS”.
Nothing in this post should be used or considered as legal, financial, tax, or any other advice, nor as an instruction or invitation to act by anyone. Users should conduct their own research and due diligence before making any decisions. The dYdX Foundation may alter or update any information in this post in the future at its sole discretion and assumes no obligation to publicly disclose any such change. This post is solely based on the information available to the dYdX Foundation at the time it was published and should only be read and taken into consideration at the time it was published and on the basis of the circumstances that surrounded it. The dYdX Foundation makes no guarantees of future performance and is under no obligation to undertake any of the activities contemplated herein.
