founder @uselotusxyz — frontier market execution, RFQs, APIs & liquidity: uselotus.xyz— cypheroracle — building cross-venue rails
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Imagine loosing because you used an aggregator.
A trader doesnt want just the best price, anyone can route to that.
This article details the biggest gap you probably missed out when executing that trade.
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Louder please.
Unfortunately, crypto has very few active users.
The most hyped launch of the year only has a handful of actual users. Even after executing a flawless marketing strategy.
The majority of crypto users are consolidated by a couple of apps like Pump and Fomo.
There isn’t a great business case anymore to build for crypto users. It’s a small TAM.
The real business case is turning blockchain into the infrastructure that powers parts of the economy and financial system.
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Theres a big gap on intent, imagine thinking prediction markets is the audience. Its just a door knob to a bigger goal.
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Imagine saying you are getting someone the best price but you stab your users in the back so they are still losing money because of lack of transparency, and sadly they wont notice because theres no way to prove it
Well, alot would change over the next couple of months.
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Reading this gave me an insight to where we stand. As an Explainer, we need to show so much proof and even thought we know how deep our rabbithole goes trying to explain it at once is never as easy as people suggest it to be. But here for it tho
"legibility" is investor-speak for "investable"
there's two main ways to be legible - you're either so spikey everyone knows, or you have to effectively teach people to read ahead of time by explaining what you do
next chapter of How to Raise:
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Mace retweeted
spent 11+ hours today deep in prediction market resolutions, UMAs, and venue rule differences for @uselotusai .
came away with the same conclusion:
the hardest part of prediction market infrastructure is not finding markets that look the same,
it’s knowing when they are actually safe to treat as the same market
from the outside, cross-venue prediction market infra sounds simple
- same event
- same headline
- same yes/no outcome
should be easy to connect, right?
not really
because similarity is where the trap is
a market on @Polymarket and a market on another venue can point to the same real-world event and still carry enough differences in wording, interpretation, or resolution logic to break your assumptions
and once your assumptions break, your routing breaks with it
that is how you end up with hidden risk, bad abstractions, and failing routes pushed downstream to traders
this is also why a lot of builders stay on the surface
the UI is easier
the dashboard is easier
the analytics layer is easier
the hard part is doing the slow work underneath:
reading the resolution criteria
studying how venues define outcomes
understanding when two markets are economically similar but not safely interchangeable
that is the layer we are building through at lotus
because traders should not have to manually inspect venue logic just to get better execution
builders should not have to rebuild market interpretation from scratch every time they want to integrate prediction markets
and institutions definitely will not scale into this category if the infrastructure underneath it is still fragile
most people see similar markets
we see the hidden differences that decide whether routing is safe or broken
that gap is a big part of what @uselotusai is built to solve.
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While doing some research into market making firms, I’m shocked at how early we are in the prediction market space. Whoever closes the bridge that allows these firms bring in size directly to prediction markets wins whats missing “Liquidity”. Right now only an handful offer market making prediction markets and its due to how extremely volatile the market is and how high the barrier to entry is.
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Saw this post: a trader caught Marvin Harrison inactive and bought Cardinals receiver overs at 24.5¢ and 23¢, then sold for +114% and +98% after fees.
That’s a real edge on one book, but 24.5¢ was the best displayed price, not the best fill.
This is what I meant in my article: even on a single venue, the top of book is what you see, not what you get. Next levels, fees, and whether the print is still there when the order lands all matter.
You can still beat that venue’s own best price on the same market, with the same dollars, you can get more shares and avoid costs eating up your profits.
This is how people make money on Polymarket.
Cardinals made Marvin Harrison Jr. inactive.
We had it Oct 10, 15:02 UTC, from Adam Schefter: "he will be inactive for Sunday’s game vs Detroit"
We bought right away: +114% and +98% after fees.
Lions vs. Cardinals - Player Props, Kendrick Bourne: Receptions O/U 2.5
14:41 the price starts to move
15:02 we get the news and buy Over at 24.5¢
18:06 it tops out at 73.5¢
20:25 calm for 2 hours, we sell at 54.5¢
+114% after fees. We caught 63% of the whole move.
Lions vs. Cardinals - Player Props, Michael Wilson: Receptions O/U 6.5
15:02 we get the news and buy Over at 23¢
15:17 the market starts to move
15:26 it tops out at 50¢
17:27 calm for 2 hours, we sell at 47.5¢
+98% after fees. We caught 95% of the whole move.
Why: With a starting receiver out, the other Cardinals receivers should catch more passes.
How it works: an "Over" share pays $1 if Kendrick Bourne catches 3 or more passes against Detroit. Its price is the chance the market gives it: 24.5¢ means 24.5%.
Not financial advice. Just information.
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There’s one thing about prediction markets that gets glamorized a lot: “Volume.”
Volume is a good gauge of interest because it shows where traders’ interest lies, but I don’t feel it’s the right metric for market quality.
You could enter a market with $200M in volume and still face high costs when putting your money in or when it’s time to take it out.
So I think liquidity depth (“OI”) would be a better metric to judge the best markets, but that won’t work because venues know traders won’t put money in markets with no liquidity.
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There are no limitations to the mind except those we acknowledge.
Both poverty and riches are offsprings of thought.
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Mace retweeted
I have a very strong researcher looking for work who specializes in technical academic papers.
If this sounds like someone you’re looking for, please reach out!
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