Concepts
UP and DOWN
Every band has two tokens. Together they always pay the band's width.
What each token pays
For a band from a low edge L to a high edge H, with the opening price P:
- UP pays P − L, never less than zero and never more than the band's width, H − L.
- DOWN pays H − P, within the same limits.
One UP and one DOWN of the same band always pay H − L together. UP gains as the opening price rises through the band; DOWN gains as it falls.
The same band at different opening prices
| Opening price | UP pays | DOWN pays |
|---|---|---|
| $54.00 | 0.00 | 5.00 |
| $55.00 | 0.00 | 5.00 |
| $57.40 | 2.40 | 2.60 |
| $60.00 | 5.00 | 0.00 |
| $63.00 | 5.00 | 0.00 |
Reading a price
Tokens trade in USDC. In the example market, UP of the $55–60 band trades around $1.53: the market values that band's UP at $1.53 of a possible $5. Bands far below the expected opening price have UP near the full width; bands far above have UP near zero.
With no listing
When a market settles at midpoints, every UP and every DOWN redeems for half its band: $2.50 in a $5 band.
Whole tokens
UP and DOWN have no decimals. You mint, trade and redeem them in whole tokens.