Auctions

Sapience uses an RFQ (Request-for-Quote) auction system. You broadcast a prediction, market makers compete to offer you the best odds, and the smart contract enforces the final settlement.

Building a Prediction

A prediction is one or more picks combined with a wager amount. Each pick is a question paired with your expected resolution (Yes or No).

• Single-pick example: "Will BTC exceed $100k by July 1?" → Yes
• Multi-pick example: "Team A wins AND turnout ≥ 60%"

Multi-pick predictions (parlays) combine several predictions into one. If every pick resolves correctly, you win. If any pick is wrong, you lose.

Probability Intuition

When picks are independent, your prediction's implied probability is roughly the product of each pick's probability.

Lower combined probability means higher potential payout—this is why parlays are attractive for expressing compound forecasts.

How the Auction Works

1. Request — You submit your prediction (picks + wager) to the relayer. This is a simple, open-source HTTP service that broadcasts your request to market makers.

2. Response — Responders analyze your prediction and submit cryptographically signed bids. Each bid includes the responder's wager amount and an expiration timestamp. Signatures ensure bids can't be forged or tampered with.

3. Selection — You choose the best offer (typically the highest wager, meaning better odds for you). Bids expire quickly, so the auction resolves in seconds.

4. Settlement — The smart contract verifies the responder's signature, transfers collateral from both parties, and mints NFTs representing each position: your prediction and the responder's anti-parlay (betting that at least one of your picks is wrong).

5. Resolution — When questions resolve, the winner burns their NFT to claim the pooled collateral.