Will I profit as a creator? The market costs 10k mana to create. However, I close the market July 1st to preserve liquidity.
If you didn't know, you get back more mana from the initial cost of the market the closer the market is to it's initial state (50% for yes/no, 1/n per answer for multiple choice and numeric)
Here is the market:
(Also, will this market be profitable as a creator? Give your arguments in the comment section below.)
1,000🏅 Top traders
| # | Trader | Total profit |
|---|---|---|
| 1 | Ṁ1,038 | |
| 2 | Ṁ6 |
On the other market, you got so much liquidity back because the market was simply wrong.
The market was wrong both because only 4 traders even participated on it during the final week of betting, when the site experienced an influx of users during the Biden Collapse AND it closed 2 weeks before the due date.
So, you risked 10k mana and didn't get a very good answer and the site happened to give you back a solid portion of your 10k mana as a result. Maybe if you left it open a few more days, someone would have noticed it and correctly predicted the trend 10 days in advance of the 15 July date!
Will I get more in fees + returned liquidity than the cost of my numeric Daily Active Users market?
It is most likely in the case where you already knew the answer before you asked the question. I don't think you knew the answer in advance so it's not super likely.
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cracks knuckles
Will I profit as a creator?
Of course you will, you will get the answer to the question you were dying to know. This is much more valuable than mana, which costs just $1 per 1000 and can be bought with a credit card any day of the week.
The market costs 10k mana to create.
Translation: I wanted to ask the entire internet a question and was willing to put up $10 in the event that someone knows the answer for sure, immediately.
However, I close the market July 1st to preserve liquidity.
Translation: It might be worth $10 to me today, but in 6 weeks it's actually worth exactly $0 to me and I don't care about getting more opinions on the answer anymore, even though the answer may not yet be known for certain.
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Closes July 1st so that liquidity is not too depleted!
Absolutely nothing about this situation is favorable for anyone involved:
It's a poor experience for question creators who have to stop getting updates on their burning questions.
It's a poor experience for participants who would have gleefully updated the market participants with breaking news within the final weeks of the market.
It's a poor experience for traders who will be averse to a two week mandatory mana lockup from 1 July to 15 July who will be afraid they could have a better use for that mana in the meantime.
It's a poor experience for lurkers who see just a frozen-in-time snapshot of 1 July, all the way through 14 July.
Instead of closing trading, you should add or remove liquidity on any given day based on how valuable the answer to your question is. If it's worth $10 to you today, you could subsidize it for $50, then withdraw your subsidy when the withdrawal amount would be $40 worth. If it's worth about $5 today, you could subsidize it for $10, wait a week, then remove 50% of the remaining liquidity, and remove 90% of it on 1 July. Then traders can continue to trade!
Great analysis, thanks for posting! I think the reason we haven’t moved towards letting creators withdraw liquidity yet is that it would be a bad experience as a trader to see the shiny ‘plus’ badge one day and come back the next day and is now a mini market. It sounds confusing and inconsistent. But maybe it’s worth it!
will this market be profitable as a creator? Give your arguments in the comment section belowall someone has to do to make it extremely profitable
all someone has to do to make it extremely profitable for the creator is place a really bad bet on the numeric market right before it closes, & this binary is guaranteed to resolve YES. let the whale bait commence!
@Ziddletwix True.
I think this is under valued because if it resolves to any number which was predicted less than the average (e.g. 2000 DAU right now), I would actually make a profit on returned liquidity. Add in the creator fees and it's not that obvious.
I think this is under valued because if it resolves to any number which was predicted less than the average (e.g. 2000 DAU right now), I would actually make a profit on returned liquidity
Hmm hard to intuit the math here, but I don't quite follow why it'd be about the displayed average (IIUC). isn't it about whether it resolves to a bucket where the market probability is lower vs higher than the starting 1/n?
and unless bets on the numeric market are "off", you'll always have >50% of the probability mass concentrated in buckets with >1/n probability? but it's interesting to guess what % will be left to those less-than-1/n buckets, and/or how "off" manifold needs to be to close some of the gap