How BetBTC Prediction Market Works?

BetBTC's market mechanics are designed to facilitate a decentralized betting environment that leverages blockchain technology for enhanced security and transparency. Here is the step-by-step process on How the BetBTC Prediction Market will work:

Fig1: Market Process

Step 1: User Login and Event Selection

User Login: Participants start by accessing the BetBTC platform through a secure login, ensuring their credentials are verified for a protected entry into the system.

Select Event: Once logged in, users browse through a list of available events. These events could range from elections and sports matches to financial market predictions, providing a diverse array of choices for users.

Step 2: Placing Bets

Choose Outcome: After selecting an event, users make a decision on the outcome they wish to bet on. They can choose to buy "Yes" shares if they believe the event will occur, or "No" shares if they believe it will not.

Purchase Shares: Users execute their choice by purchasing shares using ckBTC. The transaction process is facilitated by smart contracts that ensure a secure and transparent handling of funds according to the platform's rules.

Step 3: Price Dynamics and Adjustment

Bonding Curve Application: Prices of shares are dynamically adjusted by a bonding curve. This mathematical model increases the price of shares as more are bought and decreases them as they are sold, maintaining a balance between supply and demand.

Market Impact: Following a purchase, such as when User A buys $50 worth of "Yes" shares, the price for "Yes" increases slightly, reflecting the increased demand and decreased likelihood for "No", which conversely decreases in price.

Step 4: Event Outcome and Reporting

Event Concludes: The actual event takes place, and its real-world outcome is observed.

Oracle Reporting: An oracle system verifies and reports the outcome to the platform's smart contract. This system ensures that the results are reliable and tamper-proof, maintaining the integrity of the betting process.

Step 5: Dispute Resolution (If Applicable)

Initiate Dispute: Users can initiate a dispute if they disagree with the reported outcome. This involves staking Runes tokens as security for the dispute process.

Community Voting: The resolution of disputes is carried out through community voting. This democratic process allows the platform's community to participate in governance and decision-making, ensuring transparency and fairness.

Outcome of Dispute: Successful disputes may lead to a reversal of the market outcome, which can alter payouts accordingly, ensuring justice and correctness are maintained.

Step 6: Payouts

Calculate Payouts: Once the market resolves, the smart contract automatically calculates the payouts for each holder of winning shares.

Redeem Winnings: Winning participants can then redeem their shares. Typically, each winning share is redeemable at a set rate, usually $1 per share in ckBTC, ensuring participants receive a fair return on successful bets.

Settlement and Distribution: Finally, the calculated payouts are automatically distributed to the users' wallets on the BetBTC platform. Users can choose to withdraw their winnings or reinvest in other markets.

Step 7: Conclusion of Market Event

Market Closure: The event officially concludes once all payouts are finalized and any disputes resolved. This marks the end of the market cycle on the BetBTC platform.

Feedback and Review: Participants are often encouraged to provide feedback on their experience. This feedback is crucial for the ongoing improvement of the platform, aiming to enhance user satisfaction and platform usability.