🙋♀️ FAQs
Basic
What is PlotX?
PlotX is a non-custodial prediction protocol that enables users to earn rewards on high-yield prediction markets.
Dubbed as the Uniswap of Prediction Markets, PlotX uses an Automated Market Making algorithm to enable its users to create crypto-focused prediction markets in the intervals of 4 hours, 1 day, and 1 week.
Markets are focused on crypto-pairs like BTC-USD, ETH-USD etc, and are created as well as settled without any counterparty risk on the Ethereum blockchain.
PlotX also uses on-chain governance powered by GovBlocks.
Important Links:
What is the team background behind PlotX?
Ish Goel, Founding Member of PlotX entered the Ethereum ecosystem back in 2016. Along with Nitika, Ish won the London Blockchain Week Hackathon in 2017 and joined Nexus Mutual as the CTO.
Nitika Goel, Founding Member of PlotX entered the Ethereum ecosystem in 2016 and has served as the Lead Developer of Nexus Mutual. She also co-founded GovBlocks, an on-chain governance toolkit. She was also the author of the ERC1132 lockable token standard on Ethereum.
Kartic Rakhra, Founding Member of PlotX entered the Ethereum ecosystem in 2017 and co-founded GovBlocks along with Ish & Nitika. He also set up India's largest blockchain community via the India Blockchain Week in partnership with Fintech Worldwide.
Satheesh A, Founding Member of PlotX entered the crypto ecosystem in 2019. He comes with 25 years of experience working on CXO positions in the IT sector across marquee organizations like Cognizant, BORN and various others.
17+ other members that have been working on PlotX via Somish Blockchain Labs.
Founding members talking about their journey before launching PlotX
How long has PlotX been in development? When's the mainnet launch?
PlotX has been in development since Feb 2020 and was launched on the Kovan testnet in May 2020. The github repo can be seen at: https://github.com/plotx/smart-contracts.
To ensure a seamless experience for the users, there was an extended test phase, where community feedback helped improve the product.
After rigorous development over the year, on 13th Oct 2020, the PlotX prediction market protocol will be launched on the Ethereum mainnet. On the same date, liquidity for $PLOT tokens will also be provided on Uniswap.
How is PlotX different from projects like Augur, Synthetix (Binary Options) and HXRO?
A detailed comparative table can be seen below:
How do I sign up on PlotX - MetaMask or email?
PlotX is a non-custodial prediction protocol. To participate in prediction markets created by the community, you may connect your Metamask wallet or any of the mobile wallets supported by WalletConnect (see the list here).
For users who wish to login via their emails, non-custodial wallets that offer CeFi Bridges like Portis may be integrated. Watch this space for more announcements.
The PlotX community upholds the DeFi ethos of autonomy, however, the community is also cognizant of the regulatory concerns around KYC / AML.
Watch this space for more announcements on how these challenges are solved.
Features
What are Market Durations? What are the differences between 4 Hour, daily and weekly markets?
At the time of launch, PlotX offers three distinct time frames, namely 4 Hour, Daily, and Weekly. This means that for each asset on the platform (eg - BTC, ETH), users can choose whether they want to predict the value of that asset on an hourly, daily or weekly basis.
The time frame of a market is also known as the ‘Market Duration’ within the platform. Each Market Duration has a few similar characteristics. These are: -
Market Start Time - This is the time when a market becomes live on PlotX, and users can start making predictions in it.
Market End Time - This is the time when a market stops accepting predictions from the users, and is awaiting results.
Market Closing Time - This is the time when the results and the winners (along with their respective rewards) are decided.
Market Settlement Time - This is when the rewards are distributed to the winners of the market.
Let’s take a look at an example of each Market Duration and analyse what start, end and closing time each of them has: -
4 Hour Market
An example of this Market Duration is given below:
Market Time Frame - 4 hours
Market Start Time - 10 AM
Market End Time - 2 PM
Market Closing Time - 6 PM
Market Settlement Time - 7 PM
Notice something? You must be wondering, if the time frame of 4 Hour markets is 4 hour, then why is there an 8 hours gap between the Market Start Time (when users start predicting in it) and the Market Closing Time (when the results and the winners are declared)?
The answer to this question is another question - What do you think will happen if the protocol were to declare the results right after the market stops accepting predictions?
That’s right! Everyone would just wait for the last minute to make their predictions as then their predictions would be extremely close to the real price of the selected asset.
So, to avoid such situations, after 4 hours pass and the Market End Time arrives (2 PM), the protocol stops accepting predictions and waits another 4 hours (one more iteration of the Market Duration) to declare the results and the winners at the Market Closing Time (6 PM).
And since, each Market Duration is cyclical in nature (meaning, right after one market ends, another market of the same duration starts) each 4 Hour market asks the price of the selected asset (eg - BTC, ETH) eight hours after the Market Start Time.
Thus, the 4 Hour market in the above example might be starting at 10 AM, but it is asking the price of the selected asset at 6 PM. And right after this market stops accepting predictions at 2 PM, another 4 Hour market will start which will be asking the price of the selected asset at 10 PM. This means that during every 4-hours time frame, one 4 Hour market is live and accepting predictions, and one 4 Hour market is awaiting results.
4 Hour markets are great for those people who just don’t have the time or patience to sit around waiting days or even weeks for their rewards to come in. Predict now and you'll have the results in front of you in 8 hours.
Note - While it is true that the winners of the market (along with their respective rewards) are decided at the Market Closing Time, it actually takes another hour (in case of 4 Hour markets) for their rewards to become available for claiming.This is because there is also a cooling time of one hour (1/4th the market duration; hence, one hour in case of 4 Hour markets) between the Market Closing Time and the Market Settlement time to allow for dispute raising. To read more on Dispute, please read this FAQ: "What if I have an issue with the result of a market? Is there some way I can raise a dispute?"
Daily Market
An example of this Market Duration is given below:
Market Time Frame - 1 day
Market Start Time - 12 PM, 1st of October 2020 (today)
Market End Time - 12 PM, 2nd of October 2020 (tomorrow)
Market Closing Time - 12 PM, 3rd of October 2020 (day after tomorrow)
Market Settlement Time - 6 PM, 3rd of October 2020 (day after tomorrow)
In daily markets, users are asked to predict the price of the selected asset (eg - BTC, ETH) on a daily basis.
If a daily market is starting at 12 PM today (Market Start Time), then, it will accept predictions till 12 PM tomorrow (Market End Time), and the results of the market will be declared at 12 PM on the day after tomorrow (Market Closing Time).
And again, due to the cyclical nature of each market duration, right after the market in the above example stops accepting predictions at 12 PM, October 2nd 2020, another daily market will start that will be asking the price of the selected asset at 12 PM, October 4th 2020. And again, this means that during every 1-day time frame, one daily market is live and accepting predictions, and one daily market is awaiting results.
Weekly Market
An example of this Market Duration is given below:
Market Time Frame - 1 week
Market Start Time - 12 PM, 1st of October 2020 (today)
Market End Time - 12 PM, 8th of October 2020 (one week from today)
Market Closing Time - 12 PM, 15th of October 2020 (two weeks from today)
Market Settlement Time - 6 AM, 17th of October 2020 (two weeks 1 day 18 hours from today)
By now, you must have gotten the drill. In weekly markets, users are asked to predict the price of the selected asset (eg - BTC, ETH) on a weekly basis.
If a weekly market is starting today, then it will accept predictions until a week from today, and the results of the market will be declared two weeks from today. Moreover, right after a weekly market stops accepting predictions at the Market End Time, another weekly market will start. And during every 1-week time frame, one weekly market is live and accepting predictions, and one weekly market is awaiting results.
What are the different Market Cycles/Stages?
In order to make it easier for the users to navigate through the platform, PlotX allows its users to see each market in various stages of its lifecycle. The aim is to allow the player to have better visibility on their predictions and results.
These stages/market cycles are: -
Live
In Settlement
In Cooling
In Dispute
Settled
So, for example - if you’re in a daily market of ETH-USD that is accepting predictions, then you can say that you’re in the live daily market of ETH-USD. (Live < Daily < ETH-USD). For more clarity around the subject, mentioned below are all the stages in a little more detail:
Live
Duration: Market Start Time - Market End Time.
The very first stage for a market after creation is the ‘Live’ stage. This is where you make predictions.
In Settlement
Duration: Market End Time - Market Closing Time.
After the timer in the ‘Live’ stage runs out, the market enters the ‘In Settlement’ stage. This is when the market has stopped accepting predictions and is waiting for the results to come in.
In Cooling
Duration: 1/4th of the Market Duration you’re currently in.
After the timer in the ‘In Settlement’ stage runs out, the market enters the ‘In Cooling’ stage. This is when the results have arrived and the winners are decided. But, to ensure that everyone is on the same page and there’s no disagreement on the results, the market enters this stage for 1/4th the duration of the Market Duration you’re in.
So, for 4 Hour markets, the ‘In Cooling’ stage lasts for 1 hour, for daily markets — 6 hours, and for weekly markets — 1 day and 18 hours.
During this time, anyone who disagrees with the results can raise a dispute and that’ll push the market into the ‘In Dispute’ stage.
In Dispute
If someone raises a dispute during the ‘In Cooling’ time period, the market enters the ‘In Dispute’ stage.
When the market is in this stage, the Dispute Resolution Governance Mechanism kicks in; the Dispute is reviewed and after following the due procedure of reviewing and voting, the dispute is resolved.
Duration: 3 days are given to each dispute to either be rejected or accepted. Hence, if a market is pushed into the 'In Dispute' stage, it'll stay in this stage for 3 days. More on dispute resolution and governance later.
Settled
The final destination of every market is the ‘Settled’ stage. If any disputes are raised while the market is cooling then the extra step of “In Dispute” is added between the ‘In Cooling’ stage and the ‘Settled’ stage, otherwise, the market is settled right after the cooling period.
The ‘Settled’ stage is when the rewards are distributed to the market winners.
Which assets can I use to place predictions on PlotX?
As PlotX gets launched on the mainnet and users will also be able to purchase prediction positions using $ETH, $PLOT, and bPLOT.
$PLOT is the native token of the PlotX protocol that’ll launch on the Ethereum mainnet right alongside PlotX. bPLOT is a wrapped PLOT token that can only be used to participate in PlotX prediction markets as it is non-tradeable. The value of bPLOT is equal to that of PLOT at all times.
There are a certain number of things to keep in mind while placing predictions on PlotX:
In order to provide incentives to the market creators, the protocol charges a fee from the market participants. This fee is taken as a percentage of participation amount. For participations in ETH, the fee is 0.1%, while for participations in PLOT, the fee is 0.05%. (Read more about market creation here: Creating Markets on PlotX)
Thus, the transaction fees charged when playing with $PLOT or bPLOT is 50% less than the transaction fees charged when playing with $ETH.
Moreover, no matter which asset you use to buy prediction positions, the reward pools of $ETH and $PLOT are distributed independently of each other to all the winners.
For example, you won in a market which has a reward pool of 1 ETH + 100 PLOT, and there are 10 participants (including you) with an equal number of positions in the winning option. When this market settles, every participant in the winning option (including you) will get 0.1 ETH + 10 PLOT each, in addition to the amount they used to buy prediction positions in the market. It doesn’t matter if you played with only ETH or only PLOT or with PLOT and ETH both, you will get the proportionate share of assets belonging to the reward pool.
What is bPLOT and how do I use it to place predictions?
bPLOT (bonus-PLOT) is a wrapped PLOT token that can only be used to participate in PlotX prediction markets as it is non-tradeable. The value of bPLOT is equal to that of PLOT at all times and by using bPLOT tokens, users can mine PLOT tokens for themselves.
A few things that you need to keep in mind while making predictions with bPLOT are:
When you use bPLOT to buy prediction positions, the leverage is fixed at 5x by default and cannot be changed to a lower number (to know more about Leverage, please read this FAQ).
You can only make one prediction per unique market using bPLOT. For example, if you've made a prediction using bPLOT once in a 4 Hourly ETH-USD market which is asking for the price of ETH-USD at 2 PM, 25th November 2020, then you cannot make another prediction using bPLOT in the same market.
Each bPLOT prediction involves a conversion of bPLOT to an equal amount of PLOT as part of the 'Buy' transaction. This ensures that the reward pool only comprises of ETH and/or PLOT. This also means that if you place a prediction using bPLOT, and your prediction was correct, you'll receive back your participation amount in the form of PLOT and not bPLOT (read more about how your rewards are calculated in this FAQ).
Hence, by using bPLOT to make correct predictions, one can convert their bPLOTs (which are non-tradeable) into PLOTs (which are tradeable).
Note - Since bPLOTs can only be used to make predictions in PlotX prediction markets and cannot be traded/transferred, one must make sure to receive their bPLOTs in their MetaMask wallet or their WalletConnect supported wallet.
If you receive your bPLOTs in a wallet that isn't compatible with WalletConnect, then your bPLOTs will be rendered useless as you won't be able to connect your wallet with PlotX.
To use bPLOT to make a prediction on PlotX, select bPLOT as the payment currency in the payment asset selection toggle.
For a more detailed guide on how to make predictions, please read this guide: How to make predictions on PlotX.
What is Leverage and how do I use it?
Whenever you decide to predict in any market, you need to enter the amount of $ETH/$PLOT/bPLOT you wanna play with along with selecting the leverage you’re most comfortable with. The leverage you select determines either your risk factor or your rewards.
Talking about the risks first, 1x leverage implies that, if your prediction happens to be wrong, you’ll lose only 20% of the amount you’re playing with; 5x leverage implies that, if you happen to be wrong you’ll lose 100% of the amount you’re playing with. Leverage of 2x, 3x, and 4x reflects a risk of 40%, 60%, and 80% respectively.
Moving on to how the leverage you select affects your rewards calculation, the benefit of higher leverage comes in the form of Leverage Multiplier that gives you extra positions in the market. Since your rewards are directly tied to the number of positions you hold in the market, selecting higher leverage also directly affects your rewards.
Mentioned below is the formula that is used to calculate the leverage multiplier and the effects it has on your rewards calculation: -
Leverage Multiplier = 1 + 0.05 * (Leverage - 1)
Both the selected Leverage and the corresponding Leverage Multiplier factors into the formula used for calculating your rewards. Their combined effect on your positions and your rewards are summarized in the table below: -
As we can see, if you play with 5x, you’ll get 6 times the positions you would get if you were to play with 1x, and thus, get 6 times the rewards as well.
How does staking for Play Mining work?
To encourage play mining, players are incentivized to stake PLOT tokens to earn a multiplier on their positions during the staking period.
How it works - Users can stake (lock) their PLOT tokens within the PlotX staking smart contracts for a minimum 30 days period to boost the number of positions they’ll get while participating, subject to the following conditions: -
Minimum playing amount of 0.5 ETH or 0.5 ETH equivalent of PLOT tokens per prediction.
The staked amount being greater than the playing amount.
The Stake Multiplier helps the player increase their positions and thus be better off than a user who hasn’t staked or staked less. What makes the Stake Multiplier, also called the play mining feature, very useful is that it can be used multiple times in different markets during the course of the stake to gain extra positions and thus extra rewards. Also, even if their prediction turns out to be wrong, one doesn’t lose any of the PLOT tokens that are part of the staked amount.
The formula used to compute the Stake Multiplier is as follows: -
Stake Multiplier = 1 + (Staked Amount / Playing Amount * 10)
This formula tells us that the more PLOT you have staked, the bigger the benefit you’ll get in the form of Stake Multiplier.
But, at the same time, this also tells us that if you keep increasing the playing amount, the effects of the Stake Multiplier will keep on decreasing.
So, to summarise, to take full advantage of the Stake Multiplier, you need to strike a balance between the amount you have staked and the amount you are playing with.
Note: However, a player can only benefit from the Stake Multiplier once in a single market. Which means that if the player has taken a position inclusive of the Stake Multiplier benefit in a daily market which is predicting the value of a market pair at 1:00 PM, they will not be able to gain the benefit of the multiplier if they look to take another position in the same market.
How can I unstake my staked PLOT?
Unstaking can be done by going to the My Account page. However, there are certain conditions that need to be met before you can unstake your PLOT:
You can only unstake your PLOT only after a duration of 30 days from the date of deposit.
If you increase the staked amount before 30 days have passed from the date of the initial deposit, the lockup period will increase to 30 days from the date of the increase.
For example - on 1/1/20, a user stakes 100 $PLOT. And on 10/1/20, the user increases the staked amount by another 100 $PLOT to make the total staked amount 200 $PLOT. This means that now, the user will only be able to claim the staked 200 PLOT on/after 10/2/20 provided that they don’t increase the stake further in between.
You can see the amount of time left before you can unstake your PLOT by visiting the My Account page.
How are Options Prices calculated?
Option Price is the number of positions a user can purchase by participating with 1 $ETH assuming 1x leverage and no stake multiplier.
Note - Currently, the option prices on PlotX are denominated in $ETH. If the user participates using $PLOT, the option price shall be converted as per the current market price of the $PLOT to $ETH from the appropriate exchange platform like Uniswap V2.
The price of each option is determined by on-chain algorithms which takes two factors into account: -
1. Total amount staked in the option - The staked amount in one particular option as compared to others; if one option is very active then the option’s price increases accordingly.
This factor only kicks in when there is a minimum amount of token (minimum cumulative stake) already staked within the market across all three options. The current amount is set at 20 ETH worth of tokens cumulatively. The maximum weightage of the stake factor (aka MWSF) is by default, set to 40 percent.
The formula used to calculate the value of this factor is: -
Staking Factor Value = 10000 * Option Staked Amount / (MWSF * Cumulative Staked Amount)
Where,
Option Staked Amount = $ETH + $ETH equivalent staked in that option.
Cumulative Stake Amount = $ETH + $ETH equivalent staked in the market across all three options.
2. The current price of the asset - This factor allows the price of the option to go up if the current asset price is within the range of that option.
The option price is also affected by how much time is left for the market to close. As the market inches towards the closing time, the weightage of this factor increases accordingly.
Maximum weightage to current price (MWCP) is by default, set to 60 percent.
The formula used to calculate the value of this factor is: -
Current Price Factor Value = (Max distance - Option Distance from Current Price Option + 1) * 10000 * max(Actual Time passed, MTP) / [ (Max distance + 1) * MWCP * Total Market Time ]
Where,
Max Distance = Maximum of all the distances between the currently winning option and the rest of the options. For example, if the bear option is currently the winning option, then, the maximum distance will be 2, as the highest distance between the winning bear option and either of the other two neutral and bull options is 2. In case, the neutral option is currently the winning option, then, the maximum distance will be 1.
Option Distance from Current Price Option = Distance between the chosen option and the option that reflects the current price. For example - If the current asset price is falling in the bear option, then, the bull option will be at a distance of 2, and the neutral option will be at a distance of 1.
max(Actual Time Passed, MTP) = This function takes the higher value of the two values passed, i.e., Actual Time Passed and MTP.
Minimum Time Passed, MTP = ⅙ of the market open duration. For example - For daily markets, it is 4 hours.
The final formula for calculating the option prices for each option in the market is: -
Final Option Price in ETH (Rounded Down) = Staking Factor Value + Current Price Factor Value
How are my positions calculated?
No. of positions = (Amount^1.5 * Leverage * Leverage Multiplier * Stake Multiplier) / Option Price
There are a number of things that factor into calculating the no. of positions you’ll get for a fixed set of values. We will take a look at all of these factors one by one and see how they affect your no. of positions.
Amount - Increasing the Playing Amount will exponentially increase your positions, thanks to the
Amount^1.5factor.Leverage & The Leverage Multiplier - The effects of the selected leverage and the leverage multiplier that comes with it have been explained in detail in the following question: -
“What is Leverage and how do I use it?”
Stake Multiplier - To encourage play mining, players are incentivized to stake $PLOT tokens to earn a multiplier on their positions during the staking period. The effects of the stake multiplier have been explained in details in the following question: -
“How does staking for Play Mining works?”
Option Price - The Option Price is the number of positions a user can purchase by participating with 1 $ETH assuming 1x leverage and no stake multiplier. We have already explained how the price of each option is calculated on-chain in the following question: -
“How are Option Prices calculated?”
As the price of an option increases, the number of positions you will get in that option for a fixed amount of ETH decreases, thanks to the 1 / Option Price factor.
How are my rewards calculated?
The ultimate goal of making predictions is to make the right prediction so that you can win rewards. These rewards come from the reward pool of the market in which you placed your prediction.
Since each market can be drastically different, the reward pool for each market can also vary quite drastically depending on the amount of $ETH + $PLOT + bPLOT staked in it. The reward pool thus consists of all amounts (accounting for leverages) in the incorrect options.
The reward pool is distributed among the position holders in the correct option as their incentive for predicting accurately. Computation for the reward of each position holder in the correct option is done as follow: -
Reward Pool * (No. of positions held by the User / Total No. Of Positions in the Option)
Moreover, since multiple digital assets are allowed in a single market, the reward pool may consist of more than one digital asset, including $ETH, $PLOT, and bPLOT. The participants who predict correctly receive their staked amount back in the currency they had staked in, along with their share of the reward pool.
Other participants whose predictions go wrong, get their leverage account staked amount back after computing their losses. The reward pool per currency is calculated and each of the currencies is distributed as per the above formula on a pro-rata basis to all the winners of the market. For example - Let’s say that there is a daily market that is asking for the price of ETH-USD at 1:00 PM and has the following options: -
<$340
$340 - $360
>$360
Now, let’s assume that there are 5 participants in this market each with the following detail: -
Note - these numbers aren’t taken from any real market and are just for explanation purposes.
Let’s assume that at 1:00 PM, option 2 emerged as the winning option. This means that player 1, player 4, and player 5 are the winners of this market since they all have positions in the winning option.
Now, to calculate the rewards of these 3 players, we first need to see how much the reward pool is, and then distribute it proportionately to all the winners.
The reward pool consists of all amounts (accounting for leverages) in the incorrect options. Since player 2 and player 3 are the positions holders of the incorrect options, they’ll lose their amount at stake after accounting for their respective leverages.
Hence, our reward pool per currency will be: -
ETH: 1 ETH
PLOT: 180 PLOT
Now, we need to see how much share of the pool does player 1, player 4, and player 5 each have to distribute the pool to them accordingly.
The rewards will be distributed in the following way: -
And finally, the return amount of each player will be: -
What if I have an issue with the result of a market? Is there some way I can raise a dispute?
Dispute resolution is an important aspect of prediction markets but is also a complicated feature. There have been multiple attempts at creating decentralized judicial systems on Ethereum - and while the early contributors are cognizant of the importance of dispute resolution, the idea with PlotX was to stay away from markets that require subjective opinions at the time of market settlement, reducing the chances of a dispute.
PlotX, at the moment, provides the ability to create only those markets which can be mathematically settled. The rare chance of a dispute is when an Oracle fails to post the price of crypto assets at the time of market settlement.
In such a dispute scenario, the following workflow shall be followed by the protocol:
1. Allow for a dispute raising time (cooling period) after the market closes. This will last for 1/4th the duration of the selected market length. For example, for 4 Hour markets, it’ll last for 1 hour.
2. During this time, anyone (whether they participated in the market or not) will be able to raise a dispute by depositing a fee of 500 PLOT (provided the market doesn’t have zero participation).
3. PlotX leverages the Govblocks smart contracts that allow the PlotX community to follow a pragmatic approach to on-chain governance. After the dispute has been raised, any PLOT holder can vote on it by depositing a minimum of 500 PLOT from the ‘MY ACCOUNT’ page on the PlotX app.
4. Once the dispute is open for voting on GovBlocks, voters can vote on the dispute by either Accepting it or Rejecting it via the GovBlocks UI. However, each dispute needs to meet a few conditions to get resolved:
The users who are voting on the dispute must have a combined stake of at least 5 times the Total Value Locked (TVL) in the disputed market. For example, if the disputed market has the TVL of 1,000 PLOT, then all the users who are voting on the dispute must have a combined stake of at least 5,000 PLOT.
Each dispute gets a window of 3 days from the time of raising the dispute, to be resolved. If the combined stake of the voters doesn’t reach the target of 5 times the market TVL within these 3 days, the dispute is rejected.
If it does reach this target, then, if after 3 days have passed 60% or more votes have gone towards accepting the dispute proposal, it is accepted as the new settlement price, otherwise, it is rejected.
If the dispute is rejected, then, the 500 PLOT that the dispute raiser staked while raising the dispute are burnt.
5. The number of PLOT tokens a voter has staked has a direct impact on their vote’s weight, with there being no upper limit to how many PLOT tokens they can stake. With every PLOT token staked, the weight of the vote increases. So, if a voter is staking 500 PLOT in the ‘PLOT for Dispute Resolution Voting’ section of the My Account page, then, their vote’s weight will be 500.
6. Lastly, since there’s no upper limit to how many PLOT a user can stake, there’s also no limit to how much influence a single user can have on the dispute resolution process. Theoretically, a single user could sway the result of the proposal by staking more PLOT than everyone else combined.
However, for such an edge case, the community has the option to raise another governance proposal to burn the token staked by that user within the stake period of 15 days.
What happens if I’m the only participant in a market?
As with any other prediction, there are two possibilities for when you are the sole participant in the market: -
Your prediction is incorrect: As with any other prediction, if your prediction is incorrect, then, you lose the leveraged amount. The amount that you lose goes to the PlotX DAO, and the remaining amount minus the platform transaction fees (0.1% for ETH and 0.05% for PLOT) can be claimed once the market settles. For example - if you participated with 100 PLOT and 3x leverage, then, you will lose 60% of the participation amount, that is, 60 PLOT, and you will get back 39.95 PLOT (40 PLOT - 0.05 PLOT) once the market settles.
Your prediction is correct: If your prediction is correct but no one participated in the losing options, then, you will get your participation amount minus the platform transaction fees (0.1% for ETH and 0.05% for PLOT). This is because PlotX Prediction Markets follow a zero-sum approach. The reward pool for the winning option comprises of the total amount staked in the losing options. If the amount staked in the losing options is zero, then, the reward pool will also be zero.
Hence, in the first case, you lose out on the leveraged amount of your prediction, the gas fees you paid for that transaction, and the platform transaction fees. And, in the second case, since you don’t get any rewards from the market, you lose out on just the gas fees you paid for the transaction along with the platform transaction fees.
What happens if the market ends and my transaction is still pending?
If your transaction is still pending and the market in which you made your prediction ends, then, the transaction will fail and you will not get any positions for that prediction.
When we say that a market has ended, it means that it is no longer accepting predictions and is in the 'In Settlement' stage. To know more about this you can to these two FAQs:
Hence, whenever you’re about to make any prediction when the market is about to end, use higher gas fees to make sure that your transaction is successful before the market ends.
How are markets settled on PlotX?
The settlement process for every PlotX prediction market happens in two stages: -
When the winning option is decided using the Chainlink on-chain price feed at market closing time.
When the rewards are distributed to the positions holders of the winning option post the cooling period.
As we know, with the current Ethereum infrastructure, depending on the gas fees paid, every transaction on the Ethereum network can take anywhere from a few seconds to a few minutes to a few hours in extreme cases.
Hence, to account for a buffer for transaction mining on Ethereum, and to ensure that the winning option is decided before a market goes into the cooling period, Chainlink node operators push the latest asset price to the Chainlink smart contract, anywhere from 5 to 10 minutes before the market closing time. And since this is the same price that is used to decide the winning option, in every market, the winners are decided according to the asset price anywhere from 5 to 10 minutes before the market closing time.
Technical
How is PlotX governed on-chain? Is there an advisory board? What are their powers?
PlotX is a non-custodial prediction protocol which follows a pragmatic on-chain governance approach. Ideally, all potential actions can be defined by the code but the reality is much more complex and fall-back options are required in several circumstances. As such an Advisory Board will be set-up to facilitate decisions requiring interaction with the non-blockchain world as well as govern some of the more extreme scenarios.
Importantly, the Advisory Board has no custodial rights over the fund pool and cannot release funds to any particular person, nor does it have any control over the operation of markets. It also doesn’t have any authority to censor, restrict, modify, or revoke any actions on the platform.
Any Advisory Board member may be replaced at any time via the member voting process. To replace an Advisory Board member, any PLOT token holder can raise a proposal to swap an existing Advisory Board member’s address with their own address. Then, voting will be opened for all token holders with Accept/Reject options; and if the quorum percentage is reached, then the option with majority vote weight will decide the result.
On that path, at the time of launch on the mainnet, the community shall choose 5 advisory board members who shall have equal powers, to begin with.
The Advisory Board's powers do not translate into any level of control over the platform and is only a transitional measure for the setup of the platform. As the community grows, the role of the advisory board shall diminish with a vision to provide full autonomy to the community and decentralisation of the platform.
Which oracles are used in PlotX?
Chainlink is being used as the oracle in PlotX at the moment. Read along for details...
All prediction markets in PlotX are specifically related to the price of digital assets like BTC/USD, ETH/USD etc. This makes on-chain price discovery of assets a very important aspect of the PlotX protocol. PlotX needs price feeds for 2 reasons:
1. To compute the option prices of a prediction option - PlotX provides 3 prediction options for every prediction market on the platform. For example, in a market that is asking the price of BTC-USD at 5 PM, 13th Oct 20', there are three prediction options: -
Option a) <$10500
Option b) Between $10500-$10600
Option c) >$10600
The price of each of the above option can be different. The calculation of the option prices involves the Current Market Price of BTC (or any other crypto asset) as a factor. Meaning, if the current market price is falling under Option (c) (>$10600) then Option (c) is relatively more expensive than others. This means BTC price is constantly needed on-chain. Hence, Chainlink is used as a decentralized oracle to get the price of digital assets to compute option prices.
2. Settlement of market - Markets on PlotX are settled on-chain. This means that for a fair market settlement to happen, as accurate as possible prices are needed on-chain. To get that, Chainlink is used to feed an average of multiple sources.
Are you using any L2 scaling solutions or planning to do so?
L2 scaling is kind of obvious for a project like PlotX. With the Automated Market Making algorithm, it becomes really easy to run perpetual prediction markets but that also means that the underlying infra needs to scale.
We’ve been looking at various L2 solutions and MATIC has been one of our preferred choices so far.
Being on L2, it will allow PlotX to run shorter time frame markets as well. For example 5 mins, 15 mins - which are interesting from a retail perspective. It will also solve the Gas issues that Eth faces at the moment.
Here’s the loose idea on how it will be implemented:
Stake assets on mainnet, and then transfer assets to L2 side-chain.
All markets are opened and settled on the L2 side-chain.
When a user wishes to exit, they convert L2 side-chain assets to mainnet assets.
Read more about it here: PlotX joins hands with MATIC for L2 scalability
How do you integrate Ethereum? Is everything on-chain? Or are the order books off-chain?
The entire protocol, and it’s functioning is completely on-chain and the Oracles used for odds calculation and market settlement is publicly declared with each market.
PlotX protocol follows an Automated Market Making algorithm. There’s no manual / off-chain market making. The logic to determine the value of a particular market option is in the smart contracts.
This allows the smart contract to do the market making just like Uniswap, without any order book.
How are new markets added on PlotX?
PlotX Mainnet will launch two markets-pairs namely, BTC-USD and ETH-USD, in which users will be able to place their predictions. Moreover, the protocol is capable of adding more markets based on the community's requests via the governance mechanism. In the PlotX ethos of building a community-first product, the process will be initiated and managed via community-based governance.
This is how new markets can be added:
1. Any $PLOT holder can initiate a governance proposal for adding a new market pair like YFI-USD etc. They will have to mention the oracle feed as well.
2. $PLOT holders vote.
3. If the proposal is accepted, the market-pair will be added to the platform with hourly, daily and weekly markets.
Having said that, there will be a base criterion for assets which can be considered by the community which itself can change based on the needs of the community itself.
Last updated
