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PitchMarket adopts Polymarket’s Conditional Token Framework (CTF) model verbatim (ADR 0002): a fully-collateralized binary market, not a margin venue. No naked shorts, no leverage, no negative balances.

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Primitives

  • Collateral is USDC (integer micro-USDC on-chain, 1 USDC = 1,000,000; the UI shows cents). Prices are integers 1..99 (¢, the implied probability of the outcome).
  • Each market has two complementary SPL outcome tokens, YES and NO.
  • Complete-set invariant: 1 YES + 1 NO ⇄ $1, always. Split 1→mintaYES+NOpair;mergeapair→1 → mint a YES+NO pair; merge a pair → 1. Prices sum to $1 (a 60¢ YES implies a 40¢ NO).

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BUY vs SELL

A side is defined by which asset the maker provides: Entry-time collateral is enforced with no exceptions: a SELL for tokens you don’t hold is rejected at the API — there is no naked-short path. To take the bearish side you BUY NO, which locks USDC.

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The three match types

The engine runs a unified ladder with price-time priority across all resting populations. Three pairings settle a trade: A single taker order may fill against NORMAL makers and MINT makers in one match, but never MINT and MERGE together. Nobody is ever handed the opposite leg by surprise — you hold NO only if you explicitly bought NO.
Money moves differently per match type. NORMAL settles at the engine’s fill_price. MINT and MERGE move money at each order’s own limit price (see settle_mint / settle_merge in programs/pitchmarket/src/lib.rs). The Go store’s legDeltaFor mirrors this exactly; the two must stay in lockstep.

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Why the book is provably solvent

Solvency is structural, not a bolted-on guard (ADR 0002):
  • Every share is prepaid: a YES+NO set exists only because 1wasdepositedviaasplit,andisdestroyedonlybyamergeorredemptionpaying1 was deposited via a split, and is destroyed only by a merge or redemption paying 1 back.
  • Collateral is escrowed at mint/fill time; winners redeem against escrow, not against a possibly-insolvent counterparty.
  • The book is 100% collateralized by construction; payouts cannot bounce. Maximum loss is exactly the price prepaid.

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The unified YES ladder

The book is stored per outcome, but the frontend renders one unified YES ladder: a bid for NO at price p is equivalent to an ask for YES at 100 − p. The mapping lives in frontend/lib/api.ts (mapBook) and its mobile port.

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Beyond binary: combos and precision

  • Combos (RFQ) — a parlay is a binary complete set over the derived condition C = AND(legs) (ADR 0004). MMs sign contingent quotes off-chain; accepting escrows the full pot. Quotes are single-use (hash-marked salt) and grouped into mutex groups so contradictory legs can’t be combined.
  • Precision pools — pool-based scalar guesses (no order book): payout = Pool × (stakeᵢ·scoreᵢ)/Σ(stake·score) with a σ-normalized closeness score 1 / (1 + |guess − actual| / s)^k, k=2. Entry locks at kickoff, one entry per wallet, plus a rake — the anti-gaming triad of ADR 0006.