How Tracemarket works
Everything below describes what the code actually does. Where a rule exists to close off a specific way of losing money, the rule is written down with the reason attached to it.
The idea
A trader with a public record is already being priced informally — in who copies them, in who quietly stops. Tracemarket turns that into a contract with a settlement rule attached.
The instrument is a binary option. One side pays 1 USDG per share, the other pays nothing, and which is which comes down to a single number measured at two moments. The subject is an account, not an asset: you are not taking a view on what they hold, but on whether they end the window ahead of where they started.
What settles a market
Every market settles on cumulative account PnL — a signed dollar figure for how far ahead or behind an account is across its whole history.
Someone who deposits ten thousand dollars an hour before the close would push their portfolio value up without having traded, and every call holder would be paid on a bank transfer. Cumulative PnL is already net of flows: money in is not profit, so only closed trades move it.
Where the number comes from
A keeper reads the source on a fixed cadence and writes each read to its own file: when it happened, where it came from, and every listed handle with its PnL. Those files are the evidence, and nothing downstream reads anything else.
Two constraints on the parser carry weight. An abbreviated figure is rejected outright — at $6.8M of precision a whole day of movement can round away, settling both ends of a window to the same number and paying the wrong side. And a failed read is recorded as a gap rather than back-filled, because a keeper that was asleep observed nothing and should not pretend otherwise.
The record is served back at /api/snapshots. Committing the hash of a file nobody can fetch would prove nothing to anyone.
Snapshots and the median rule
Each end of a market is the median of the 3 readings nearest that moment, never a single print.
Three readings, one of them wrong. The median lands on the middle value, so the spike changes nothing — which is the point: no single reading, however well timed, decides anybody's position.
strike = median(3 readings nearest open) settle = median(3 readings nearest close) winner = settle > strike ? call : put
A reading more than 20 minutes from the moment being valued is not eligible at all. Fewer than 3 eligible readings at either end and the market voids instead of resolving. Note the strict inequality: a window that ends exactly where it began resolves to the put.
How the odds open
A market seeded at an even split claims both sides are equally likely, which the record usually contradicts. Instead the opening price is the model's probability that cumulative PnL is higher at the close than at the open.
Treating PnL as a walk with drift μ and per-step volatility σ over n steps, that is P = Φ(μ√n / σ). Crypto returns are fat-tailed, so a normal tail overstates how confident the estimate deserves to be; a Student-t with four degrees of freedom pulls the answer back toward even, which is the conservative direction for a book that has to quote both sides. Prices are clamped to 15–85¢ so neither side becomes untradeable.
How the price moves
Each market is a fixed-product pool holding a reserve of each outcome. Collateral mints one of each outcome token — a call and a put together are always worth exactly 1, since exactly one pays — and a purchase withdraws the wanted side, sized so the product of the reserves is unchanged.
Price is the ratio between reserves, which is why price and implied probability are the same number: a call at 43¢ is the book saying 43%. Both sides always sum to 1.
Seeded depth is $25,000 per market. That is not arbitrary: at $10 of depth a $100 buy fills roughly 42¢ away from the quoted price, which makes the multiple on the card a number nobody actually receives. A fill more than 5¢ from the quote is refused outright.
What you get paid
A winning share redeems for exactly 1 USDG; a losing share is worth nothing. The fee is 2% and it is charged on winnings only, at redemption. A position that loses pays no fee, because there is nothing to take a fee from.
This is also why a flat book quotes 1.98x rather than 2.00x: the multiple on every card is what lands in the wallet after the fee, not the gross ratio before it.
When a market voids
A void refunds every position at cost. It is not a failure mode — it is the right outcome whenever the evidence cannot support a settlement, and strictly better for a position holder than being resolved against a number that cannot be defended.
If you are the subject
Listing does not ask permission, so a market can exist on you without your involvement. Two things follow, and both are implemented rather than promised.
You can leave. One signature delists you, voids every open market on your handle, and refunds each position at cost — no negotiation step, nothing to opt into first.
There is also an escrow that accrues to your handle whether or not you have heard of any of this. Its share is currently 10% of every fee taken at redemption; this page reads that constant rather than restating it, so it will say otherwise the moment it changes.
Parameters
Glossary
How far an account is up or down over its whole history. The underlying every market settles on.
One reading of the source, kept as a file with its time and origin.
The service that takes those readings and serves them back.
The value at the open, committed as the market's record of where it started.
Both ends are the median of the three nearest readings, so no single one decides anything.
The two sides: the call pays if PnL is higher at the close, the put if it is not.
A contract worth exactly 1 unit of collateral if its condition holds, nothing if it does not.
A refund at cost, used whenever the evidence cannot support a settlement.