The exchange Backpack has also recently seized the US election prediction market and launched US Election Prediction Markets. Users can participate in predictions by purchasing TRUMPWINS or HARRISWINS tokens. It is understood that Backpack uses the OutcomeMarket smart contract created by market maker Wintermute to mint tokens to maintain transparency and security in the prediction market.
Play predictions through smart contracts, taking into account transparency and security
OutcomeMarket is the latest smart contract launched by Wintermute. Backpack mints TRUMPWINS or HARRISWINS tokens through OutcomeMarket, and users can participate in predictions by buying and selling tokens. This smart contract will act as a treasury until the end of the election, receiving USDC and minting OutcomeERC20 tokens.
The protocol is currently deployed on Ethereum, Arbitrum, and Base, and settlement will be managed by Chaos Labs using Edge Proofs Oracle. The benefit of using this smart contract is to provide a clear payment structure for the prediction market. Wintermute's role as market maker makes it possible to tokenize the liquidity of the prediction market without much problem. In addition, this is a permissionless smart contract that cannot be changed after deployment. It has been audited by Hexens and Cyfrin and no major problems have arisen.
The general election is approaching, and the tokenized prediction market has huge potential
According to Dune data, the prediction market Polymarket’s trading volume reached $533 million in September, a record high and a quarterly increase of 12.9%. The number of active trading users reached 90,000 in September, a record high and a 41.5% increase from the previous quarter. The number of new users in a single month reached 90,000, which also hit a record high, with a quarterly increase of 25.5%. As the election time approaches, these data may still have room for growth, which also shows the huge potential of the prediction market.
The gameplay of US Election Prediction Markets is that the token prices of TRUMPWINS and HARRISWINS will be lower than 1 USDC, and the specific prices will change according to the market predicted probability of winning the election. Assuming that the market is optimistic that Trump has a 60% chance of winning, the price of TRUMPWINS may be 0.6 USDC. If the market believes that Harris has only a 40% winning rate, the HARRISWINS token price will be 0.4 USDC.
At the end of the election, the winning party’s tokens will be redeemable at a price of 1 USDC. Although unlikely, if a third outcome occurs and neither is elected, the exchange price will be 0.5 USDC.
Inherit the will of FTX? Former FTX executive launches new exchange to predict market
The biggest problem in the on-chain prediction market is regulatory trouble. Looking at the background of Backpack, we can find that almost all of its senior management have participated in the FTX and Solana ecosystems. This may also be the reason why it took over FTX and launched prediction market business as a centralized exchange. However, the exchange has been registered in Dubai, which may be why they can confidently predict the market.
We have mentioned before that why many exchanges choose to register in Dubai is because they feel that the local government here treats the crypto industry as a hope rather than a crime.
(Former FTX executives and Solana wallet Backpack will establish a new exchange in Dubai)
This article Backpack plants a flag to predict the market! Is there any news about the exchange’s launch of a tokenized prediction market by a former FTX executive? First appeared in Chain News ABMedia.