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Automated Market Maker (AMM)

PolyPulseBets does not use a traditional “order book” where you have to wait for someone to match your bet. Instead, we use an Automated Market Maker (AMM).

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Supply and Demand

The price of a share represents the probability of that outcome occurring, ranging from 0.00∗∗(00.00** (0%) to **1.00 (100%).
  • Buying YES: When you buy “YES” shares, you are adding USDC to the “YES” pool. This increases the price of YES and decreases the price of NO.
  • Selling YES: When you sell shares back to the pool, the price of YES goes down.

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The Math

The protocol ensures that the price of YES + NO always equals 1.00∗∗.If∗YES∗istradingat∗∗1.00**. If *YES* is trading at **0.60, NO will automatically trade at $0.40.

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Slippage

Because prices move based on how much is bought or sold:
  • Small Trades: Have little impact on the price.
  • Large Trades: Can move the price significantly (slippage). The UI will always show you your “Average Entry Price” before you confirm a trade.