Pari-Mutuel Market

1. Model Definition & Core Mechanism

The Pari-Mutuel model, also known as the shared pool system, consolidates all participant funds into a collective pool. Winners will share the pool proportionally after deducting applicable fees—similar to the "total pool distribution（totalizator）" system used in horse racing.

Participants make predictions on an event outcome and contribute funds based on their prediction. Once the result is revealed, funds are distributed according to the correct predictions.It’s also quite straightforward to grasp. Odds and payouts are calculated simply by dividing the total amount placed in a pool by the amount predicted on each outcome. 2. Odds Calculation & Payout Distribution

To calculate pari-mutuel odds, users mainly need to consider two primary factors :

• The total amount of funds collected in the pool

• The proportional distribution of the pool

Note：TThe payout and odds users receive are mainly determined by the total funds in each outcome pool and their proportional distribution

🧾 Payout Distribution — rewards are calculated based on the following formula:

User Payout = ( User Contribution ÷ Total Contributions on Correct Outcome ) × Total Pool Amount × ( 1 – Fee Rate )

User Payout = ( User Contribution ÷ Total Contributions on Correct Outcome ) × Total Pool Amount × ( 1 – Fee Rate ) Formula Explanation:

• Total Pool Amount: The total sum of all funds wagered by all participants across all outcomes

• Total Contributions on Correct Outcome: The total amount wagered on the outcome that ultimately wins/correct.

• User Share Ratio: User’s Contributed Amount / Total Contributions on the Winning Outcome — this represents the user’s proportional share within the winning group

• Fee Rate: The percentage of fees deducted from the total payout.

Fee : The claiming process is calculated with a 10% fee applied

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Illustrative Example: How It Works

1. The Market Question

Which team will win the match? Prediction Options: Team A | Team B

Your Action: You placed a 500 USDT bet on Team B.

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Funds Distribution： 💰Total Pool: 10,000 USDT Option — Team A Wins: 6,000 USDT Option — Team B Wins: 4,000 USDT 🏁 Event Result: Team B won the match.

✪Your claim：( 500/4,000 )*10,000*（1-10%）=1,125 USDT

Q1：Why can't I sell my position on Pari-mutuel markets? ❖ Pari-mutuel markets are designed with a pooled contribution mechanism, dynamic odds, and post-event prize distribution. Since there is no real-time trading price or liquidity counterparty in this market structure, it is not possible to sell or exit positions early without compromising fair and transparent settlement.