Community Feedback: Experimenting with shorter duration markets

Preamble

Introducing markets with a shorter prediction window (15 minutes), called Rapid Markets

Abstract

This proposal describes an experiment aimed at assessing the feasibility of rapid markets (15 minutes LIVE + 45 minutes settlement time), as compared to incumbent hourly, daily and weekly markets.

Motivation

On average, a predicting user makes 15 predictions a day on PlotX (see graph below).

A vast majority of these predictions are in the hourly markets. It is also observed that more than 70% of users predict within the last 15 minutes of a typical hourly market, despite being faced with higher option prices towards the end of the market duration. Since all hourly markets start and end at the same time (every GMT o’clock), this means that these users are active only 25% of the time.

The proposed rapid market experiment aims to drive higher user engagement while also increasing capital efficiency and the potential ROI of users.

Specification

The current hourly markets have a turn-around time of 2 hours. In the 1st hour, the market is Live and accepts predictions. In the next hour, the market goes In Settlement, after which the market is settled.

Rapid markets, on the other hand, shall be ‘Live’ for 15 mins and ‘In Settlement’ for the next 45 mins. This brings down the turnaround time for the market to be 1 hour. Additionally, instead of all markets following the same clock, we propose to start a new market every 15 mins.

A sample cycle of markets is as under:

Description Market 1 Market 2 Market 3
Asset BTC/USD BTC/USD BTC/USD
Start Time 09:00 am UTC 09:15 am UTC 09:30 am UTC
Live Until 09:15 am UTC 09:30 am UTC 09:45 am UTC
Settled at 10:00 am UTC 10:15 am UTC 10:30 am UTC

Since the turnaround time of markets will be 1 hour, we also propose to move away from the current approach of 3 options to only 2 options, Going Up/Down for these Rapid markets.

A comparison of the Rapid Markets vs the current hourly markets can be seen as under:

Features Current Hourly Market Proposed Rapid Market
New market creation frequency 1 hour 15 minutes
Prediction time 1 hour 15 mins
Prediction options 3 2
Settlement time 1 hour 45 mins
Market Turnaround time 2 hours 1 hour
No. of markets per day per asset 24 96

Rationale

Rapid markets allow users to increase their predictions per hour ratio, making efficient use of their capital and time. This is due to the lower turnaround time for these markets and higher frequency of market creation.

This will allow us to study popular opinion on crypto markets at a granular level since now users will get a chance to predict every 15 minutes, which provides valuable information in making the product better and more community-centric.

What’s next?

As an experiment, these rapid markets will be launched for the following 2 assets - BTC and ETH. This means that along with 24 hourly markets in a day, users shall now also get 96 more markets to predict on. Based on performance and user experience results, more features & crypto assets will be added to the rapid markets experiment.

This experiment will be conducted for 30 days.

Users will be able to identify these markets in the dapp with a prominent identifier.

This period should provide sufficient data to make the feature efficient and permanent for the community.

Thoughts, comments, or feedback? I’d love to hear them! :arrow_down:

Great concept. I am a fan of the shorter markets and don’t mind paying an higher option price to make a later prediction given the current volatility in the crypto space.

Like the idea of 2 options instead of 3. Spread would be too tight to get in 3 options in these short markets.

Hopefully will bring a few more predictors to the platform