About

About Yosoku

Yosoku is a decentralized prediction market protocol built on Solana, enabling users to trade on the outcomes of real-world events. The protocol combines high-performance on-chain order matching with cross-chain oracle resolution via LayerZero, providing a trustless and transparent framework for prediction markets.

How Prediction Markets Work

Prediction markets allow participants to trade shares representing the probability of future events. Each market poses a question with a binary outcome, and participants can buy or sell shares reflecting their beliefs about the likelihood of each outcome.

Share Pricing

• Yes shares represent belief that the outcome will occur

• No shares represent belief that the outcome will not occur

• Share prices range from $0.01 to $0.99

• Prices reflect the market's collective probability estimate

• At resolution, winning shares pay out $1.00 per share; losing shares pay $0.00

Example

Consider a market asking: "Will Bitcoin exceed $100,000 by December 31, 2025?"

• If Yes shares trade at $0.65, the market implies a 65% probability of occurrence

• A trader who buys 100 Yes shares at $0.65 pays $65

• If Bitcoin does exceed $100,000, the trader receives $100 (profit of $35)

• If it does not, the trader receives $0 (loss of $65)

Market Types

Yosoku supports two market structures to accommodate different prediction scenarios.

Regular Markets

Regular markets feature a single binary question with one Yes/No share pair. These are ideal for straightforward predictions with two possible outcomes.

Example: "Will the Federal Reserve cut interest rates in Q1 2026?"

Multi-Leg Markets

Multi-leg markets contain multiple related outcomes under a single market umbrella. Each leg operates as an independent Yes/No pair, allowing traders to speculate on various possibilities within the same event.

Example: "Who will win the 2026 World Cup?"

• Leg 1: Brazil

• Leg 2: France

• Leg 3: Argentina

• Leg 4: Germany

Each leg has its own order book, enabling independent price discovery for each potential outcome.

Trading Mechanics

Yosoku employs a central limit order book (CLOB) model, providing transparent price discovery and efficient order matching.

Order Types

Limit Orders Place an order at a specific price. The order remains in the book until filled or cancelled.

Market Orders Execute immediately against existing orders in the book at the best available prices.

Covered Bids Use existing share positions as collateral for new orders. Traders holding Yes shares can use them to back No bids, and vice versa, enabling capital-efficient trading strategies.

Share Merging

Traders holding equal quantities of Yes and No shares for the same market leg can merge them to redeem $1.00 per pair. This mechanism ensures price consistency and provides an arbitrage pathway when Yes + No prices deviate from $1.00.

Resolution System

Yosoku implements two resolution mechanisms to accommodate different trust models and use cases.

Two-Tier Resolution (UMA Oracle)

The primary resolution mechanism leverages the UMA Optimistic Oracle for decentralized dispute resolution.

Tier 1: Proposal

1. Any participant can propose an outcome by submitting a USDC bond

2. A dispute window opens for other participants to challenge the proposal

3. If no dispute occurs within the window, the proposal is finalized and the proposer's bond is returned

Tier 2: Dispute

1. A disputer can challenge the proposal by submitting a higher bond

2. The dispute is escalated to the UMA Oracle via LayerZero cross-chain messaging

3. UMA token holders vote on the correct outcome

4. The winning party receives both bonds (minus protocol fees)

5. The market resolves according to the UMA decision

Wallet Vote Resolution

For markets requiring trusted resolution by designated parties, Yosoku supports wallet-based voting.

1. Market creators designate a set of authorized voter wallets

2. Voters cast their resolution votes on-chain

3. Resolution occurs when a majority (>50%) consensus is reached

4. If no majority is reached by the deadline, the market resolves to a 50/50 split, with all shares paying $0.50

Cross-Chain Architecture

Yosoku's architecture separates trading execution from oracle resolution across chains.

Solana Layer

• Order book management and matching

• Position tracking and share accounting

• Vault custody of USDC collateral

• Real-time trade settlement

Cross-Chain Messaging (LayerZero)

• Secure message passing between Solana and Ethereum

• Dispute escalation to UMA Oracle

• Resolution receipt and market finalization

Ethereum Layer (UMA Oracle)

• Optimistic oracle for disputed outcomes

• Token-weighted voting mechanism

• Economic security through bonding requirements

This architecture combines Solana's high throughput and low latency for trading with Ethereum's established oracle infrastructure for trustless resolution.