1. Definitions
| Term | Definition |
|---|---|
| Platform | Eventa Markets — operated by an individual (non-profit oriented one-person project) |
| Share | Binary contract: pays 1 if outcome occurs, 0 otherwise |
| Market | Question with outcomes, resolution criteria, closing date |
| AMM | Automated Market Maker — deterministic pricing from quantities |
| LMSR | Logarithmic Market Scoring Rule — the AMM used |
| Liquidity (b) | Constant controlling market depth |
| Oracle | Designated source determining winning outcome |
| bps | 1 bps = 0.01% |
2. Legal & Operator
Prediction markets vs gambling: No counterparty house; prices from auditable formula (LMSR). Information-discovery role. Binary structure aligns with MiFID II / CFTC event contracts.
Regulatory: CFTC approves event contracts (Kalshi, CME); MiFID II may classify as financial instruments; IEM under no-action letter.
Operator: Individual operator. Does not set prices, take exposure, or act as counterparty.
3. Market Lifecycle
Before RESOLVED → may CANCELLED (full refund)
| State | Allowed Actions | Transition Conditions |
|---|---|---|
| Pending | Submit pre-orders; admin edits market | → Open when min_participants AND min_total_stake met, or admin activates |
| Open | Buy/sell shares; AMM active | → Closed when closesAt datetime reached |
| Closed | No new trades; await resolution | → Resolved when oracle/admin declares winning outcome |
| Resolved | Payouts distributed; read-only | Terminal state |
4. LMSR (Formulas)
C(q₁,…,qₙ) = b · ln( Σᵢ e^(qᵢ/b) )
pᵢ = e^(qᵢ/b) / Σⱼ e^(qⱼ/b)
Cost = C(q + Δq) − C(q)
Properties: bounded loss = b·ln(n); path independent; incentive compatible. Implemented in Rust (eventa-core) with decimal precision.
5. Fees & Payout
| Fee | Range | Application |
|---|---|---|
| Spread | 1–3% | Per market |
| Trading | 50–200 bps | Per trade |
| Settlement | 0–200 bps | On payout |
Net = shares × 1.0 − (shares × fee_bps / 10,000)
6. Resolution & Settlement
CLOSED → oracle declares winner → RESOLVED → payouts distributed.
| Scenario | Resolution |
|---|---|
| Event cancelled | Full refund at cost basis |
| Ambiguous | Committee review |
| Data unavailable | Cancel or fallback per rules |
7. Risk & Custody
Risk: Liquidity bounds loss; min participants/stake; KYC tiers; rate limiting; admin oversight.
Custody: User funds tracked per user/currency/network. Rust engine is computation only. NestJS manages balances. Smart contracts provide verifiable settlement when deployed. Decimal(36,18); idempotent refs.
8. Compliance
| Tier | Requirements | Limits |
|---|---|---|
| 0 | Browse only | |
| 1 | Gov ID | Standard |
| 2 | ID + address | Elevated |
| 3 | ID + address + source of funds | Max |
AML: transaction monitoring; withdrawal approval; IP geolocation; audit logging. See Privacy Policy.
9. Disputes
Contact support → committee review → confirm / overturn / cancel. Target: 7 business days.
10. Formula Reference
C(q) = b·ln(Σ e^(qᵢ/b)) pᵢ = e^(qᵢ/b)/Σe^(qⱼ/b) D = 1/p A = ±100p/(1−p) F = (1/p)−1 Net = shares × 1.0 − (shares × fee_bps/10000)
11. How to Fund & Trade (XRPL)
Eventa Markets' first production uses the XRP Ledger (XRPL) only. You trade with XRP and/or RLUSD (Ripple USD stablecoin). Connect your XRPL wallet via Reown WalletConnect; there is no EVM, Polygon, or cash in the initial rollout.
Funding your XRPL wallet
- Use an XRPL-compatible wallet (e.g. Xumm, CROSSMARK) that supports WalletConnect.
- Obtain XRP or RLUSD via an exchange, DEX, or wallet-native swap. Send only to your own XRPL address (r...).
- Connect your wallet to Eventa via WalletConnect when placing a position; you sign EscrowCreate to lock funds. No deposit to a platform address — funds stay in XRPL escrow until the market resolves.
Important
- XRPL only. First production does not support Polygon, Ethereum, or other chains. Do not send EVM or other assets to an XRPL address.
- You control your keys. We never hold your wallet; you connect and sign with your own XRPL wallet.
- Double-check amounts and address before signing. Transactions cannot be reversed.
12. Payment & Settlement
Eventa Markets' first production uses the XRP Ledger (XRPL) only: XRP and RLUSD (real USD stablecoin). All user funds are non-custodial — locked in XRPL escrow and signed via Reown WalletConnect. There is no EVM, Polygon, or cash in the initial rollout.
| Principle | Description |
|---|---|
| Non-custodial | Platform never holds user funds; all transactions are wallet-signed |
| XRPL only (v1) | First production: XRP Ledger with XRP + RLUSD only; no EVM, no Polygon, no cash |
| Auditable | All settlements happen on-chain; XRPL ledger enforces transfers |
| WalletConnect | Reown WalletConnect — user signs with XRPL-compatible wallets |
| No fiat balances | No fiat stored; settlements are on-chain only |
Settlement (XRPL)
| Asset | Mechanism | Signing |
|---|---|---|
| XRP + RLUSD | EscrowCreate / EscrowFinish | Reown WalletConnect (XRPL) |
Flow
- User connects XRPL wallet via Reown WalletConnect.
- User selects a market and amount (XRP or RLUSD).
- Backend calculates required amount and platform fee; constructs EscrowCreate.
- User signs EscrowCreate through WalletConnect; funds locked on XRPL.
- Oracle resolves market; backend verifies outcome.
- EscrowFinish releases winnings and platform fee; Payment to winners.
- User receives funds; platform fee to platform wallet.
Core Principle
The platform never touches funds until settlement. All locking and releasing is enforced by the XRPL ledger; users remain in control of their wallets.
Regulatory Note
Non-Custodial & Compliance
Using XRPL makes the flow compliant because users are in control: they sign EscrowCreate and the ledger holds the locked funds. The mechanism (conditional escrow) is provided by the XRP Ledger; the company charges a fee for using it. No e-money licensing for custody; platform facilitates escrow and market logic only. WalletConnect ensures users control signing and funds. No fiat balances stored; all settlements on-chain. The escrow coordination pattern aligns with the open-source xrpl-market-orchestrator.
13. Key Concepts Explained
Brief explanations of terms used across the platform.
What is Escrow?
Escrow means your funds are locked on the XRPL ledger until the market settles. The platform cannot move them — only the outcome (win/lose/cancel) triggers release. Your stake stays under your control via your wallet; you sign EscrowCreate and the ledger holds it until resolution.
What is WalletConnect?
Eventa uses Reown WalletConnect. You connect your XRPL-compatible wallet (e.g. Xumm, CROSSMARK) and sign transactions without giving the platform access to your funds. You approve each action — escrow lock — and your wallet talks directly to the XRP Ledger. The platform never sees your private keys.
What does "XRPL only" mean?
First production supports only the XRP Ledger: XRP and RLUSD (Ripple USD stablecoin). Any asset that can be escrowed on XRPL can be used (e.g. XRP, RLUSD, or other XRPL-escrowable tokens). There is no Polygon, Ethereum, or other chain, and no cash deposits. Other rails may be added in later phases after compliance is in place.
How does XRPL (XRP / RLUSD) work?
You connect an XRPL wallet via WalletConnect and sign EscrowCreate to lock XRP or RLUSD. Funds stay in XRPL escrow until the market resolves. The platform then submits EscrowFinish and immediately redistributes to winners. Custody is minimal and short-lived — only at settlement, driven by the Rust engine payout logic.
Why Non-Custodial?
Non-custodial means the platform never holds your funds in a central account. Escrows are on-chain; you sign to lock and release. This avoids e-money licensing, reduces counterparty risk, and keeps you in control. Fees are taken at settlement; no fiat balances are stored.