The 2025 MLB season has been a rollercoaster, and the World Series promises to deliver all the excitement of a championship showdown, with the LA Dodgers lining up against the Toronto Blue Jays. 

Now, the dYdX community is bringing a new way to experience the upcoming 2025 World Series with prediction market-based perpetuals, the first of its kind for the World Series. Trade on which team will take home the trophy and turn your baseball insights into trades.

What Are Prediction Market-Based Perpetuals? 

Prediction market perpetuals are derivatives that let you gain financial exposure to the outcome of real-world events like sports, elections, or pop culture moments. For the World Series Perpetual, the question is simple: Will the LA Dodgers win or lose the 2025 World Series? Market prices reflect the perceived odds: if your prediction wins, your position settles at $1; if they lose, it drops to near zero. 

Why Trade the World Series on dYdX?

Prediction-market based perpetuals give traders a different toolkit than traditional fantasy sports or betting apps:

• Perpetual Leverage Trading: Take advantage of up to 5x leverage to amplify capital efficiency and choose your preferred exposure to the 2025 World Series result.
• Advanced Risk Management: Use tools like stop-loss and take-profit orders to protect your positions and manage potential risks in this premiere sporting event. 
• Real-Time Settlement: The market is pegged to settle based on the outcome of the World Series, providing a clear and transparent way to trade on narrative-driven events.

How to Join the Action

Getting started is simple:

1. Visit dYdX: Head straight to the 2025 World Series Perpetual market on dYdX or Pocket Pro Bot on Telegram and search “DODGERSWIN-USD” under Markets. 
2. Connect Your Wallet: Fund instantly with USDC to start trading ($100+ deposits are free and instant). 
3. Place Your Bets: Go long on DODGERSWIN-USD if you expect Shohei Ohtani and the LA Dodgers to win. Go short on DODGERSWIN-USD if you expect them to lose.

Prediction markets can experience rapid fluctuations around the time of settlement as the event’s outcome becomes known, and traders should understand the role of auto-deleveraging (which can reduce profits on the winning side to offset liquidated accounts that would otherwise go negative) and other contract loss mechanisms in perpetuals markets. Learn more about prediction market-based perpetuals here.

Why It Matters

In October 2024, the dYdX community launched its first-ever prediction market perpetual with the Presidential election, and is now bringing it to the 2025 World Series. Looking ahead to the rest of Q4, our goal is to empower the dYdX community to expand prediction-market-based perpetuals across a wide range of events including sports championships, global elections, and any real-world moments that can be traded.

We are democratizing financial opportunity, giving you the chance to trade not just markets, but the real-world events that truly matter.

Making Prediction Markets Better

The dYdX community previously listed the TRUMPWIN market perpetual on the outcome of the 2024 U.S. election, which provided valuable lessons about the trader experience, liquidity management, and market mechanics of perpetuals with event outcome underliers. One of the key areas we’re focused on improving in Q4 is the auto-deleveraging (ADL) process to make it smoother and more predictable for traders on the respective prediction market. .

As a reminder, under normal circumstances positions on dYdX are automatically liquidated before they can reach a negative balance. If there is a shortfall between a position’s liquidation price and the user’s bankruptcy price, the insurance fund will cover that shortfall. 

• ADL on dYdX serves as an additional risk management mechanism to maintain protocol solvency which triggers when the negative balances of liquidated positions exceed the insurance fund's capacity or a position reaches a negative balance before it can be liquidated, typically during periods of significant market volatility. 
• ADL works by reducing  randomly-selected profitable positions to offset positions that have gone negative. This ensures that the protocol remains solvent at all times and that trading can persist through difficult market conditions. 
• You can read more about ADL here. 

Prediction market perpetuals can be especially likely to trigger ADL because of the binary nature of event outcomes and because there are generally insufficient liquidations to fund the respective prediction market’s insurance fund (note: isolated markets have a separate an independent insurance fund compared to the insurance fund available for cross margined assets). The liquidation price can be expected to abruptly move to $0 or $1 once the outcome of the event becomes known, which can cause leveraged positions on the losing side to trigger ADL. 

We’re considering solutions to improve ADL in the context of prediction market-based perpetuals.  In the meantime, dYdX software users and community members have various tools to address the impact of ADL in these markets should they wish to do so.       

1. Prefund the insurance fund: insurance funds on dYdX are capitalized by liquidation fees, so insurance funds for recently-listed isolated markets will typically have less capital. By prefunding the insurance fund for a prediction-market perpetual, the community can create a buffer to absorb potential losses from liquidations and lower  the probability of needing to trigger ADL. If the isolated market’s insurance fund has a capital surplus, the dYdX community can decide to transfer it back to the main insurance fund. 
2. Compensation after market settlement: the community can choose to reimburse traders for lost profits due to ADL. 

User education: the community can also consider additional efforts to ensure that users are educated as to the mechanics of ADL and are as equipped as possible to plan their trading strategies around it.