📒Glossary
Buy Position
A position that speculates that the average value of the index will be higher than the price value. A buy position is represented on-chain by a long share NFT.
Cap & Floor
Cap
A cap is the predetermined upper bound on the pool's payout. It is the maximum value that the index can reach for the purposes of contract settlement. It limits the downside of the short positions.
The cap is set before the pool starts, based on recent historical data. For more details on the calculation, refer here
Floor
A floor is the predetermined lower bound on the pool’s payout. It is the minimum value that the index can reach for the purposes of contract settlement. It limits the downside of the long positions.
The floor’s value is set before the pool starts, based on recent historical data. For more details on the calculation, refer here
Contract
An agreement that allows users to speculate on the movement of an underlying index (e.g., Bitcoin transaction fees) within a specified time period defined by start and end dates.
A contract has five parameters:
startDate, endDate, cap, floor, and the index
Index
A time-varying benchmark value that reflects market dynamics, such as the average Bitcoin transaction fee over a given period. It's essential for setting contract parameters and outcomes.
Market
The underlying index that users can speculate on, such as Bitcoin transaction fees, Base L2 gas fees, Ethereum gas fees, or other derivatives. Currently, we have the Bitcoin transaction fees market.
Orders
Instructions from users to place a long or short position at specified prices. If another user finds an existing order favorable, they can fill it and complete the transaction.
Payment
The upfront payment required to buy or sell an order.
Note that market orders that users fill from the order book will include a 0.5% taker fee.
Payout
The total amount that is claimable at the end of the pool period.
For ongoing pools that have not ended, the payout is estimated based on current average fees.
Period
The duration for which a contract is valid and enforceable, defined by the start and end dates.
Silica Pools
A silica pool is a collection of all long and short positions within a specific time period (e.g., April 1 - April 30).
Users can enter, trade, or close positions during the pool's period.
Currently, the pool tracks the rolling average o the index since the start of the pool (e.g. April 1). Upon settlement (e.g. April 30), the final payout is calculated based on the average of the median Sat/vB per block across all blocks during the pool’s period.
Price
The price at which you are buying or selling BTC fees. It serves as a benchmark for determining if the trade is profitable or not.
Sell Position
A position that speculates that the average value of the index will be lower than the entry/breakeven value. A sell position is represented on-chain by a short share NFT.
Size
The amount of units of the index being traded in a contract (e.g., virtualBytes for Bitcoin transaction fees)
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