Introduction to Speed Markets
Last updated
Last updated
Digital Options get kicked into overdrive with the fast-paced excitement of Speed Markets! Speed Markets allow users to purchase UP or DOWN positions in digital options built on short time frames and strike prices based on a snapshot of the current price. This new product under the Overtime umbrella is the result of and the communities' need for speed!
Traders choose an asset, direction (UP or DOWN) and strike time for that asset based on the trader's predicted price movement from the asset's current price. Once a trader submits a transaction to purchase a position, a snapshot of the asset's current price is taken to define the strike price. Because the strike price is always taken from the current price of an asset at the time of a buy, all positions will have 50:50 implied probabilities. This means that a winning trader will see a 2x payout (minus the quoted LP fee and a fixed 2% Safebox fee) on a single winning position.
Pyth Benchmark on-demand oracles provide historically queryable prices that can be used to validate trades in near real-time, an important factor for risk management of intraday markets such as Speed Markets. Every second, Pyth Benchmark price feeds are updated using source data from reputable third-party data publishers that can be easily verified from the Pythnet blockchain.
The parameters for Speed Markets will be maintained via the Overtime Governance process. Configuration TIPs for considerations like opening the SpeedMarketAMM up for LPing will need to be submitted by the community and voted in by the Thales Council. Initial funding will be provided by the TreasuryDAO, but future LPing could take it's place to provide liquidity for Speed Markets.
Speed Markets offer a minimum epoch of 15 minutes, but the goal is to offer epochs as short at 5 minutes in the future.
The maximum time to maturity will be 24 hours.
ETH and BTC will be the supported assets, with expansion to more assets planned in the future.
Speed Markets will include an LP fee that changes depending of a Strike Time and a protocol fee of 2%.
10 min - 14 min 59s
15%
15 min - 59 min 59 sec
13%
60 min - 119 min 59 sec
12%
120 min - 24 h
10%
The minimum buy-in will be 5 USD, with a maximum of 200 USD (but both can be changed).
The AMM Risk Cap per Asset per Day will begin at 5000 USD.
Positions can be purchased using the several forms of collateral, with the minimum amount of each adjusted to equal 5 USDC. The following forms of collateral are accepted:
Typical Positional and Ranged Markets close for positioning when the maturity date/time is less than 24 hours away due to protocol risk management, but some traders couldn't wait on the sidelines for that long. To satisfy the community Thales developed Speed Markets to work with nearly instantaneous pricing data, made possible with the use of .
