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Documentation Index

Fetch the complete documentation index at: https://hypernode-docs.polynode.dev/llms.txt

Use this file to discover all available pages before exploring further.

HIP-4 introduces native prediction markets as first-class L1 instruments on HyperLiquid. These are binary outcome contracts that settle between 0 and 1, built on top of the HIP-3 deployment pipeline with distinct trading mechanics.

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Core properties

Unlike perpetual futures, prediction markets operate under a restricted set of rules:
  • 1x isolated margin only — no leverage, no liquidation
  • No continuous oracle feed and no funding rates
  • Price = CLOB mid during active trading
  • Price bounds: 0.001 to 0.999
  • Loss is capped at the amount paid to enter
These constraints make prediction markets fundamentally different from perps. There is no liquidation risk because positions are fully collateralized by design.

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Pair minting model

Every prediction market has two tokens: YES and NO. They always sum to 1.00 in value.
Buying YES at 0.40 is economically identical to selling NO at 0.60. The protocol enforces this invariant at the L1 level through the pair minting mechanism.
When you deposit 1 unit of collateral, the protocol mints 1 YES token and 1 NO token. You can then sell the side you don’t want on the orderbook. 
1 collateral -> 1 YES + 1 NO (always)
YES price + NO price = 1.00 (always)

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Four L1 actions

HIP-4 defines four native actions for interacting with outcome markets:
Deposit collateral to mint a matched pair of YES and NO tokens.Fields: collateral (amount), question (market identifier)This is the primary entry point. Depositing 1 USDC mints 1 YES + 1 NO. You then sell whichever side you don’t want on the CLOB.
Merge a matched pair of YES + NO tokens back into collateral.Fields: tokens (amount to merge)The inverse of SplitOutcome. If you hold both sides, you can recombine them to recover collateral without paying spread on the orderbook.
Merge across a multi-outcome question.Fields: question (market identifier)Used for questions with more than two outcomes, allowing cross-outcome merges.
Flip position direction.Fields: asset, amount, and additional parametersConverts a YES position into the equivalent NO position (or vice versa) without going through the orderbook.

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Settlement

Settlement is handled by a designated oracle address (oracleUpdater) that posts the final value:
  1. Oracle posts the resolution value
  2. Trading halts instantly
  3. All positions auto-settle in a single block
  4. Winners receive 1.00 per token, losers receive 0
There is no gradual wind-down or expiry period. Settlement is atomic and immediate once the oracle posts.

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Fee model

Opening a position is free. Fees are only charged on closing or settlement.
HIP-4 outcome markets use spot fee rails, meaning they inherit the spot trading fee schedule:
ActionTaker (cross)Maker (add)
Open position0 bps0 bps
Close on orderbook7.0 bps4.0 bps
Settlement7.0 bps—
Fees are charged in the outcome token, not in USDC. A governance hook (SetOutcomeFeeScale) exists that allows validator vote to adjust outcome fee rates independently from base spot fees in the future.
VIP tier discounts, staking discounts, and referral discounts all apply to outcome market fees the same way they apply to spot fees. See the fee structure page for full details.

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Asset ID encoding

Prediction market tokens use a distinct ID range within the HyperLiquid asset system: 
Asset type          ID range
──────────          ────────────────
Perpetuals          0, 1, 2, ...        (BTC=0, ETH=1, ...)
Spot tokens         10000+
Spot variants       110000 - 170000+
Prediction outcomes 1900000+
For EVM bridge operations, outcome tokens use a separate index scheme: 
EVM bridge index = 100_000_000 + int(str(outcomeId) + str(sideId))

Example:
  "BTC > 68k" YES token = 100019520
  "BTC > 68k" NO token  = 100019521

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Minimum order size

The minimum order size is dynamic, based on the current mark price: 
size x min(markPx, 1 - markPx) >= $10 USDC
This means cheaper outcomes (closer to 0 or 1) require larger token quantities to meet the $10 notional minimum. At a mark price of 0.10, you need at least 100 tokens. At 0.50, you need at least 20.

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Deployment

Any HIP-3 deployer can deploy HIP-4 prediction markets. Becoming a deployer requires staking 500,000 HYPE. Deployment uses dedicated L1 actions:
  • RegisterOutcome — register a new outcome market
  • RegisterTokensAndStandaloneOutcome — register tokens and outcome in a single action
Market structure is defined through:
  • OutcomeSpec — defines the outcome parameters
  • QuestionSpec — defines the question being resolved
  • OutcomeTracker — tracks outcome state through its lifecycle

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Deployer fee share

The deployer_trading_fee_share parameter and fee_recipient address exist in the deployment configuration, allowing deployers to earn a share of trading fees. However, on testnet this value is currently observed as 0.0 for all prediction market deployments, meaning deployers do not yet receive trading fees. This may change when prediction markets launch on mainnet. See the fee structure page for more details on deployer revenue mechanics.