Bottom Call
Good entry here imho. Nfa, dyor
6hKtz8FV7cAQMrbjcBZeTQAcrYep3WCM83164JpJpump
Forwarded from heuristics
I know some people were looking for a diagram, here's the initial rendition of the primitive for both LPs and traders and how they loop together.
It's a bit dense as combining DLMM mechanics into a prediction market hasn't been done before with the addition of curve-based trading, so I'll explain it more later as I tune it a bit, but the concept remains.
LPers have an immense benefit of fee accrual on a prediction market-scale and receive two other specific streams specific to Isometric's design of the markets:
1. They receive the difference of LMSR refunds (if a trader closes a position early, they receive the difference of (cost - refund)).
2. Settled markets often don't result in a bullseye— this is perhaps one of the biggest jumps from prediction markets + DLMMs/AMMs. Traders enjoy a non-binary outcome (where even if they're wrong, they still receive a portion of a payout instead of losing 100%), while LPers profit from the difference (if a trader opens a $100 position, the price settles at a point where they receive a $67 refund, the LPers get the $33— everybody's happy; traders don't lose everything, LPers get the difference).
LPing on Isometric is just as profitable as trading on Isometric by design. It's a closed-loop system where all parties are properly compensated for activity.
It's a bit dense as combining DLMM mechanics into a prediction market hasn't been done before with the addition of curve-based trading, so I'll explain it more later as I tune it a bit, but the concept remains.
LPers have an immense benefit of fee accrual on a prediction market-scale and receive two other specific streams specific to Isometric's design of the markets:
1. They receive the difference of LMSR refunds (if a trader closes a position early, they receive the difference of (cost - refund)).
2. Settled markets often don't result in a bullseye— this is perhaps one of the biggest jumps from prediction markets + DLMMs/AMMs. Traders enjoy a non-binary outcome (where even if they're wrong, they still receive a portion of a payout instead of losing 100%), while LPers profit from the difference (if a trader opens a $100 position, the price settles at a point where they receive a $67 refund, the LPers get the $33— everybody's happy; traders don't lose everything, LPers get the difference).
LPing on Isometric is just as profitable as trading on Isometric by design. It's a closed-loop system where all parties are properly compensated for activity.