Welcome to 42’s Private Beta, where you’ll experience a new generation of prediction markets built on a modified dynamic parimutuel (DPM) mechanics: a system that merges trading and prediction into one seamless experience.
The 42 DPM is a dual-role market ‘winner-takes-all’ system where users can participate both as momentum traders and predictors.
As a trader, you can speculate on price movements and exit before the market concludes. As a predictor, you can hold your position until resolution and claim a portion of the rewards pool if your chosen outcome wins.
Each market supports multiple outcomes, represented by Outcome Tokens (OTs). These tokens are tradable and priced dynamically using a bonding curve, meaning the token price automatically adjusts based on demand and supply.
Here, no external liquidity providers are needed as prices are determined entirely by market dynamics.
Every buy (mint) or sell (redeem) transaction interacts directly with the market contract, adjusting the pool size. When the market resolves, winning OT will absorb the entire prize pool (market cap of all OTs), and redistribute to the holders pro rata.
When you mint (buy) outcome tokens, the cost follows the mint curve where each new mint increases the marginal price.
The higher the demand for a specific outcome, the more expensive it becomes to mint new tokens.
For instance, if the current outstanding supply is 100 OTs, the next token may cost $3; if it rises to 200, it might cost $5.
Simply put: the earlier you enter, the cheaper your position.
When you redeem (sell back) your tokens, the system references the same mint curve to determine the base value, then applies a redeem spread contributed back to the pool. This mechanism redistributes value from sellers to conviction holders, effectively increasing the potential payout for those who remain until resolution.