Up/Down Options
Simple Directional Bets Over Fixed Time Periods
Up/Down Options, sometimes referred to as Binary Options, offer traders the ability to make quick directional bets on the price movement of trading pairs over a selected time duration — with binary outcomes, no liquidation risk, and a success-based fee model that only applies to winning trades.
Think the BTC/USD price will be higher (or lower) than the current price in 5 minutes? In 1 hour? Test your luck by staking a bet on Lynx's Up/Down Options - if you're correct, you'll win the amount you bet (minus a success fee); if you're wrong, you'll lose the amount you bet.
Initially, Up/Down Options will be available on Sonic, supporting BTC/USD and ETH/USD trading pairs, with more instruments coming soon.
Key Features
Pre-Determined Payouts: No need to guess how much you'll win - earn a fixed return if the market moves in your predicted direction.
No Liquidations: There’s no risk of early liquidation — positions resolve at expiration only.
Time-Based Trades: Choose from multiple time durations (e.g., 5m, 15m, 1h) before results are determined.
Only Pay a Trading Fee if you Win: There are no open or close fees. A success fee is only applied to profitable trades.
Support for Multiple Betting Assets: Bet with $S or $USDC and receive any winnings in the same asset.
Fee Structure
Success-Based Fee Mechanism:
Winning Trades: If your prediction is correct, you’ll receive your initial bet amount back, along with an 85% net profit (equivalent to 100% profit, minus the 15% success fee).
Losing Trades: If your prediction is incorrect, you lose the bet amount — no other fees apply.
Liquidity
When you place a bet, the counterparty is a liquidity pool of the same asset (e.g., bets using $USDC go against the $USDC pool). To guarantee payouts for winning traders, your potential winnings are reserved from the pool at the time of entry. For example, a bet using 10 $USDC would reserve 8.5 $USDC from the pool: 85% of your 10 $USDC bet amount, which is your potential winnings.
If the pool doesn’t have enough to cover the full payout, the trade won’t go through—ensuring pool solvency at all times.
Currently, liquidity pools are permissioned, meaning only approved participants can provide liquidity. This may open up in the future.
How to Use Up/Down Options
Access Up/Down Options: Open the trading interface and navigate to the Options tab.
Select Parameters:
Trading Pair: Choose BTC/USD or ETH/USD.
Collateral Asset: Choose between $S or $USDC.
Amount: Define how much you want to bet.
Time Duration: Select how long until the trade settles (e.g. 15m).
Direction: Choose UP if you think the price of the trading pair will be higher than it is at opening time or DOWN if you think the price will be lower.
Submit Trade: Once placed, your position is locked and cannot be altered or canceled
Monitor & Settle Automatically: Track your trade’s status in the live dashboard. At settlement the trade is resolved based on the Pyth price feed.
Important Considerations
No Trade Modifications: Once submitted, Up/Down positions cannot be canceled or changed.
Binary Outcomes: Profit or loss is determined solely by whether the asset finishes above or below the assigned entry price at expiration.
Price Source: Prices are set at the time your transaction is opened and settled, based on real-time Pyth oracle data.
Risk Management: While there is no liquidation risk, the binary nature of these trades means you may lose 100% of your staked amount on an incorrect prediction.
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