Thales: on-chain Positional Markets

What is the Thales?

The creation of several kinds of on-chain Positional Markets is made possible by the Thales Protocol’s oracle-based automated liquidity solution, which is only constrained by the quantity of data that the blockchain can access.

You can engage in markets for various crypto assets through the straightforward yet effective smart contracts that form the basis of Thales Market; however, this structure is not restricted to straightforward up/down positions. The Thales protocol is still innovating; it has created more sophisticated trading solutions like Ranged Markets AMM, community-based games like Thales Royale, and the first SportsAMM and ParlayAMM solution in the world by utilizing on-chain sports data.

Each unique market is a separate smart contract with result criteria determined by an oracle. These market contracts all use USD as collateral to mint positions as ERC-20 Positional Tokens. For a small fraction of a US dollar, traders can buy these tokens. Winning Positional Tokens can be redeemed for one dollar at market clearing, while losing Positional Tokens expire useless. When a market is in the trading phase, Thales’ unique AMM architecture integrates market-making with prices determined from real-time oracle data feeds. When the market reaches maturity, it resolves the market so that traders can cash in on their winning positions.

An Overview of Parimutuel Marketplaces

The ability to provide Parimutuel Markets on the blockchain is Thales’ primary innovation. Collateral is deposited into a single common pool in parimutuel markets, and winning players get payouts from this pool following a market-settling event. One of the two distinct outcomes (Thales Positional Markets, for example) or any number of mutually exclusive outcomes (Overtime Sports Markets, for example) can be a market-settling event. In these kinds of markets, the payout is just the whole pool divided among all winning positions (without the house fee).

Particular Markets

Though this is by no means to the maximum of Thales’ ability, the Parimutuel format is perfect for generating markets that center on the price movement of crypto assets. Any off-chain occurrence has the potential to serve as the foundation for a custom market or competition because of the network of data authenticators called “Oracles” that post information to the blockchain.

On the blockchain, an immutable market can be built if the data is accessible to an oracle and a definitive result can be determined. A few instances of this result include the approaching of a deadline, the announcement of the competition winner, or the achievement of a specific strike price for a cryptocurrency asset. And there isn’t a huge risk associated with this freedom. A Parimutuel Market’s minimal risk and significant upside are easily understood, making participation easy to pick up fast while maintaining its unpredictable and enjoyable nature. 

Thales Vaults

Strategies for Vaults : 

Different strategies are used, such as focusing on positions with probabilities above or below a specific threshold or incorporating positions that are discounted by a specific amount.

Discounts vault: Purchases positions with a calculated likelihood of greater than 50% and at a discount greater than 3%.

Degen Discount Vault: Purchases positions that are offered at a discount of more than 2%, without considering the likelihood of the position.

Safu Discount Vault: Purchases positions with a determined likelihood of greater than 75% and at any discount (1% or more).

Trading strategy and the subsequent variables define vaults:

Utilization rate Price upper and lower bounds

Maximum Skew effect

Maximum allotment on a certain market

Minimum deposit and minimum amount on a single trade

Maximum number of users and total deposit in the vault (Vault Caps)

The primary benefits of Thales Vaults’ passive trading

For each round, there is no requirement to withdraw or deposit money. Collateral kept in a vault will automatically roll over to the following round, plus any wins or minus any losses from the previous round.

Trading Fees for vaults are reduced (from 3% to 0.5%). Traders gain from TIP-105 because it gives Thales Vaults and their methods a greater advantage than if a user executed the same trades by hand.

Users’ whole deposits made into the vaults (whether they be Thales or Overtime) count toward the “Protocol volume” incentive for gamified staking.