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Pumpcade uses a parimutuel system where all predictions go into a shared pool. Winners split the pool based on their share size, with early predictors rewarded through time-weighted shares and all winners guaranteed to get their original deposit back.
Beta Note: During beta, markets do not require predictions on both YES and NO sides. This allows you to experience the full market lifecycle without needing other users to participate. In production, markets will require 1 participant on each side for a market to execute.

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The basics

When you make a prediction, you’re not predicting against the house. You’re predicting against other users. Everyone’s tokens go into a single pool, and when the market resolves, the winning side splits everything.
1

Predictions go into the pool

Users predict YES or NO. All tokens (after fees) go into a shared vault.
2

Market resolves

At the deadline, the outcome is determined. One side wins.
3

Winners split the pool

Winners get their original deposit back, plus a share of what the losing side put in.

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Time-weighted shares

Not all predictions are equal. Pumpcade rewards users who predict early by giving them more shares per token.

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How it works

When you predict, your tokens are converted into shares based on when you enter:
  • First 10% of market duration: Full 1.0x multiplier (fair launch period)
  • Remaining 90%: Multiplier decays from 1.0x down to 0.2x
The earlier you predict, the more shares you get for the same amount of tokens.

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Example

A 10-minute market opens at 12:00 and closes at 12:10.
The fair launch period (first 10% of duration) ensures everyone has a chance to get in at full value before the decay kicks in.

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Principal protection

Winners always get their original deposit back. The losing pool is then distributed proportionally based on shares.

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Payout formula

Where:
  • Principal = Your original deposit amount (net of fees)
  • Your Shares = Shares you earned on the winning side
  • Total Winning Shares = All shares on the winning side
  • Losing Pool = Total tokens deposited on the losing side

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Market Example

A market has the following predictions: YES side (wins) NO side (loses) Totals:
  • YES pool: 200 tokens, 150 shares
  • NO pool: 150 tokens (this gets distributed to winners)
Payouts:
Alice deposited the same amount as Bob, but because she predicted earlier, she got twice the shares and twice the profit.

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Why this design?

No liquidity problems

Traditional order books need matched buyers and sellers. Parimutuel pools always work. You can predict even if you’re the only one on your side.

Early bird advantage

Time weighting rewards conviction. If you spot an opportunity early, you’re rewarded for the risk of predicting before odds stabilize.

Principal protection

Winners always get at least their original deposit back. You’re only risking the chance to profit, not your entire stake.

Self-balancing odds

As more people predict one side, the potential payout per share decreases. The market naturally finds equilibrium.

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Fees

A 1% fee is taken from each prediction before it enters the pool: Fees are deducted upfront. If you deposit 100 tokens, 99 tokens go into the pool and are used to calculate your shares.