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MicBun merged 2 commits into from
Mar 12, 2026
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docs: view order book end-to-end market demo #108

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docs: view order book end-to-end market demo
MicBun Mar 12, 2026
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357 changes: 357 additions & 0 deletions examples/order_book/05_run_market_demo.py
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"""
Complete Prediction Market Demo: LP Setup, Trading, Settlement & Rewards

End-to-end demo that exercises every part of the prediction market:

1. Creates a new market (settles in 5 minutes).
2. Market Maker places LP pair orders (two-sided liquidity).
3. Buyer Taker buys YES shares that MATCH against the order book.
4. Waits for settlement (YES wins — BTC is above $10k threshold).
5. Verifies everything:
- Fee Distribution (75% LP / 12.5% DP / 12.5% Validator)
- LP Rewards (Market Maker)
- Data Provider Rewards
- Validator Rewards
- Buyer Settlement (winning shares + payout)
- P&L for all participants

After this script completes, use 06_verify_rewards.py to re-check.
The query_id is saved to .query_id for 06 to pick up automatically.
"""

import os
import time
import requests
from datetime import datetime, timezone, timedelta
from trufnetwork_sdk_py.client import TNClient

# Configuration
NODE_URL = "http://ec2-3-141-77-16.us-east-2.compute.amazonaws.com:8484"
INDEXER_URL = "http://ec2-52-15-66-172.us-east-2.compute.amazonaws.com:8080"

# Wallets
## WARNING: These are throwaway private keys provided for testnet examples only.
## DO NOT use these keys for production or store any real funds in these wallets.
MARKET_CREATOR_KEY = "a537437df2ed8d3bcb3b99b4f88818cadf8ac365cd0a66595bb50973ac4ecf51"
MARKET_MAKER_KEY = "1b94f77f8eeb3ff78aa091b0965bf1b54305e3af50f9a6cd24cb457edc8c77ed"
MARKET_MAKER_ADDR = "0xc11Ff6d3cC60823EcDCAB1089F1A4336053851EF"
BUYER_TAKER_KEY = "9b70937b21176cfa48f0859f4063c66a7998964cc2dfde873ef3d54c8fe04d74"
BUYER_TAKER_ADDR = "0x1c6790935a3a1A6B914399Ba743BEC8C41Fe89Fb"

# Known infrastructure participants
DATA_PROVIDER = "0xe5252596672cd0208a881bdb67c9df429916ba92"
VALIDATOR_ADDR = "0x231ea6C42aD77036237EF1C6398b76D0afc7Fd9e"

# Market Parameters
BITCOIN_STREAM_ID = "st9058219c3c3247faf2b0a738de7027"
THRESHOLD = "10000" # Guaranteed to be above (BTC price is high) → YES wins
BRIDGE = "hoodi_tt2"


def with_retry(fn, *args, max_retries=5, initial_backoff=2, retry_on=(Exception,), **kwargs):
"""Executes a function with exponential backoff on transient failures.

Only retries when the raised exception is an instance of one of the
types listed in *retry_on*. Non-matching exceptions propagate immediately.
"""
retries = 0
while retries < max_retries:
try:
return fn(*args, **kwargs)
except retry_on as e:
retries += 1
if retries >= max_retries:
raise

backoff = initial_backoff * (2 ** (retries - 1))
print(f" Warning: {e}")
print(f" Retrying in {backoff}s... ({retries}/{max_retries})")
time.sleep(backoff)


def create_client(url, key):
"""Create a TNClient with retry for transient network errors."""
return with_retry(TNClient, url, key, max_retries=10, initial_backoff=3)


def format_wei(wei_str):
"""Format wei string to human-readable TRUF amount."""
try:
wei = int(wei_str)
return f"{wei / 1e18:.4f} TRUF ({wei_str} wei)"
except (ValueError, TypeError):
return str(wei_str)


def format_ts(ts):
"""Format unix timestamp to human-readable string."""
try:
if ts and isinstance(ts, (int, float)) and ts > 0:
return datetime.fromtimestamp(ts, timezone.utc).strftime('%Y-%m-%d %H:%M:%S UTC')
except (OSError, ValueError):
pass
return "N/A"


def main():
print("=" * 60)
print("Complete Prediction Market Demo")
print("=" * 60)

# =========================================================================
# 1. Create Market
# =========================================================================
client_creator = create_client(NODE_URL, MARKET_CREATOR_KEY)

now = datetime.now(timezone.utc)
settle_time = now + timedelta(minutes=5)
settle_timestamp = int(settle_time.timestamp())

print(f"\n1. Creating market settling at {settle_time.strftime('%H:%M:%S UTC')}...")
print(f" Threshold: BTC > ${THRESHOLD} → YES wins (guaranteed)")
try:
tx_hash = client_creator.create_price_above_threshold_market(
data_provider=DATA_PROVIDER,
stream_id=BITCOIN_STREAM_ID,
timestamp=settle_timestamp,
threshold=THRESHOLD,
bridge=BRIDGE,
settle_time=settle_timestamp,
max_spread=10,
min_order_size=1_000_000_000_000_000_000,
)
print(f" Tx hash: {tx_hash}")
client_creator.wait_for_tx(tx_hash)
except Exception as e:
print(f"Error creating market: {e}")
return

markets = with_retry(client_creator.list_markets, limit=10)
query_id = None
for m in markets:
if m.get('settle_time') == settle_timestamp:
query_id = m.get('id')
break

if not query_id:
print("Could not find created market query_id")
return
print(f" Market Created: Query ID {query_id}")

# Save query_id for 06_verify_rewards.py to pick up
query_id_file = os.path.join(os.path.dirname(os.path.abspath(__file__)), ".query_id")
with open(query_id_file, "w") as f:
f.write(str(query_id))
print(" Saved to .query_id for 06_verify_rewards.py")

# =========================================================================
# 2. Market Maker: Create holdings + LP pair orders
# =========================================================================
#
# LP reward scoring requires BOTH:
# - TRUE-side pair: YES sell + NO buy (prices sum to 100)
# - FALSE-side pair: NO sell + YES buy (prices sum to 100)
#
# The LEAST(TRUE-side score, FALSE-side score) ensures both sides are needed.
#
# Market midpoint will be ~50 (from bid/ask), dynamic spread = 5 cents.
# LP pairs must have prices within [mid-spread, mid+spread] = [45, 55].
#
# IMPORTANT: Buy prices must be strictly BELOW existing sell prices of the
# same outcome to avoid the matching engine consuming the LP pair orders.
#
# Order of operations:
# 1. Split order: creates YES holdings (price=0) + NO sell@50
# 2. Bid/ask far from LP prices to establish midpoint
# 3. TRUE-side: YES sell@51 + NO buy@49 (49 < 50, won't match NO sell@50)
# 4. FALSE-side: YES buy@50 (50 < 51, won't match YES sell@51)
# =========================================================================

print(f"\n2. Market Maker ({MARKET_MAKER_ADDR[:10]}...) setting up LP positions...")
client_mm = create_client(NODE_URL, MARKET_MAKER_KEY)

# Step 1: Split order -- creates YES holdings + NO sell@50
print(" a) Split order: 300 shares at price 50...")
client_mm.place_split_limit_order(query_id, true_price=50, amount=300)
print(" Created: 300 YES holdings + 300 NO sell@50")

# Step 2: Establish bid/ask for midpoint calculation (far from LP prices)
print(" b) Setting bid/ask for midpoint...")
client_mm.place_buy_order(query_id, outcome=True, price=46, amount=50)
print(" YES buy@46 (bid)")
client_mm.place_sell_order(query_id, outcome=True, price=54, amount=50)
print(" YES sell@54 (ask)")

# Step 3: TRUE-side LP pair -- YES sell@51 + NO buy@49
print(" c) TRUE-side LP pair...")
client_mm.place_sell_order(query_id, outcome=True, price=51, amount=100)
print(" YES sell@51 (amount=100)")
client_mm.place_buy_order(query_id, outcome=False, price=49, amount=100)
print(" NO buy@49 (amount=100) -- safe: 49 < NO sell@50")

# Step 4: FALSE-side LP pair -- NO sell@50 (from split) + YES buy@50
print(" d) FALSE-side LP pair...")
client_mm.place_buy_order(query_id, outcome=True, price=50, amount=300)
print(" YES buy@50 (amount=300) -- pairs with NO sell@50 for LP, safe: 50 < YES sell@51")

print(" LP setup complete!")
print(" Expected LP pairs:")
print(" TRUE-side: YES sell@51 + NO buy@49 (amount=100 each)")
print(" FALSE-side: NO sell@50 + YES buy@50 (amount=300 each)")

# =========================================================================
# 3. Buyer Taker: Buy YES shares (order MATCHES the order book)
# =========================================================================
#
# The matching engine supports price-crossing: a buy order at price P
# matches any sell at or below P (standard order book behavior).
# The buyer places buy@52, which crosses the MM's YES sell@51.
# Match executes at sell price ($0.51), buyer is refunded $0.01/share.
#
# Result: Buyer acquires 5 YES shares at $0.51 each (not $0.52).
# Since YES wins at settlement, buyer gets 5 × $1.00 = 5 TRUF payout (minus 2% fee).
#
# This generates trading fees that fund LP/DP/Validator rewards.
# =========================================================================
print(f"\n3. Buyer Taker ({BUYER_TAKER_ADDR[:10]}...) buying YES shares...")
client_taker = create_client(NODE_URL, BUYER_TAKER_KEY)
client_taker.place_buy_order(query_id, outcome=True, price=52, amount=5)
print(" Buyer placed YES buy@52 (amount=5)")
print(" Price-crossing: matches YES sell@51 → Buyer acquires 5 YES shares at $0.51")
print(" Expected at settlement: 5 shares × $1.00 = 5 TRUF payout (minus fees)")

# =========================================================================
# 4. Wait for settlement
# =========================================================================
print(f"\n4. Waiting for settlement (approx {settle_time.strftime('%H:%M:%S UTC')})...")
print(" Settlement process:")
print(" a) Scheduler detects market is past settle_time")
print(" b) Requests attestation from data provider")
print(" c) Attestation signed by validator")
print(" d) Scheduler calls settle_market → distributes fees")
# Wait extra 2 minutes for attestation + settlement scheduler
wait_until = settle_time + timedelta(minutes=2)
while True:
now_utc = datetime.now(timezone.utc)
if now_utc > wait_until:
break
remaining = (wait_until - now_utc).total_seconds()
print(f" Waiting... {int(remaining)}s left", end="\r")
time.sleep(10)
print("\n Market should be settled now.")

# =========================================================================
# 5. Verify Fee Distribution (75% LP / 12.5% DP / 12.5% Validator)
# =========================================================================
print("\n5. Fee Distribution...")
time.sleep(10) # Wait for indexer sync

dist_url = f"{INDEXER_URL}/v0/prediction-market/markets/{query_id}/distribution"
resp = with_retry(requests.get, dist_url, timeout=20, max_retries=5, initial_backoff=5)

distributed_at = None
if resp.status_code == 200:
data = resp.json().get("data", {})
distributed_at = data.get("distributed_at")
print(f" Total LP Fees: {format_wei(data.get('total_fees_distributed', '0'))}")
print(f" Total DP Fees: {format_wei(data.get('total_dp_fees', '0'))}")
print(f" Total Validator Fees: {format_wei(data.get('total_validator_fees', '0'))}")
print(f" LP Count: {data.get('total_lp_count')}")
print(f" Distributed At: {format_ts(distributed_at)}")
elif resp.status_code == 404:
print(" Not available yet — settlement is async, check back later.")
print(f" URL: {dist_url}")
else:
print(f" Unexpected response: {resp.status_code}")

# =========================================================================
# 6. Verify Rewards (LP, Data Provider, Validator)
# =========================================================================
print("\n6. Reward History...")

participants = [
("Market Maker (LP)", MARKET_MAKER_ADDR),
("Data Provider", DATA_PROVIDER),
("Validator", VALIDATOR_ADDR),
]

for label, wallet in participants:
print(f"\n --- {label} ({wallet[:10]}...{wallet[-4:]}) ---")

rewards_url = f"{INDEXER_URL}/v0/prediction-market/participants/{wallet}/rewards"
params = {"limit": 5}
if distributed_at:
params["cursor"] = str(distributed_at)

resp = with_retry(requests.get, rewards_url, params=params, timeout=20, max_retries=5, initial_backoff=3)
if resp.status_code == 200:
data = resp.json().get("data", {})
rewards = data.get("rewards", [])
total = data.get("total_rewards", "0")
print(f" Total Rewards (all markets): {format_wei(total)}")

market_reward = next((r for r in rewards if r.get("query_id") == query_id), None)
if market_reward:
print(f" Market {query_id}:")
print(f" Amount: {format_wei(market_reward.get('reward_amount', '0'))}")
print(f" Percent: {market_reward.get('total_reward_percent')}%")
else:
print(f" No reward for market {query_id} yet (settlement may be pending).")
else:
print(f" Failed to get rewards: {resp.status_code}")

# =========================================================================
# 7. Verify Buyer Settlement (winning shares + payout)
# =========================================================================
print(f"\n7. Buyer Settlement ({BUYER_TAKER_ADDR[:10]}...)...")

settle_url = f"{INDEXER_URL}/v0/prediction-market/participants/{BUYER_TAKER_ADDR}/settlements"
resp = with_retry(requests.get, settle_url, timeout=20, max_retries=5, initial_backoff=3)
if resp.status_code == 200:
data = resp.json().get("data", {})
settlements = data.get("settlements", [])
print(f" Total Won: {data.get('total_won', 0)}")
print(f" Total Lost: {data.get('total_lost', 0)}")

market_settle = next((s for s in settlements if s.get("query_id") == query_id), None)
if market_settle:
print(f" Market {query_id}:")
print(f" Winning Shares: {market_settle.get('winning_shares', 0)}")
print(f" Losing Shares: {market_settle.get('losing_shares', 0)}")
print(f" Payout: {format_wei(market_settle.get('payout', '0'))}")
print(f" Refunded Collateral: {format_wei(market_settle.get('refunded_collateral', '0'))}")
else:
print(f" No settlement for market {query_id} yet.")
else:
print(f" Failed to get settlements: {resp.status_code}")

# =========================================================================
# 8. P&L Summary for all participants
# =========================================================================
print("\n8. P&L Summary...")

for label, wallet in [("Market Maker", MARKET_MAKER_ADDR), ("Buyer Taker", BUYER_TAKER_ADDR)]:
pnl_url = f"{INDEXER_URL}/v0/prediction-market/participants/{wallet}/pnl"
resp = with_retry(requests.get, pnl_url, timeout=20, max_retries=5, initial_backoff=3)
if resp.status_code == 200:
data = resp.json().get("data", {})
print(f" {label}: Realized={data.get('realized')} Unrealized={data.get('unrealized')} Total={data.get('total')}")
else:
print(f" {label}: Failed ({resp.status_code})")

# =========================================================================
# Summary
# =========================================================================
print("\n" + "=" * 60)
print("Demo complete!")
print(f"\nMarket {query_id} — run 06_verify_rewards.py to re-check (reads .query_id).")
print("\nQuick links:")
print(f" Distribution: {INDEXER_URL}/v0/prediction-market/markets/{query_id}/distribution")
print(f" MM Rewards: {INDEXER_URL}/v0/prediction-market/participants/{MARKET_MAKER_ADDR}/rewards")
print(f" DP Rewards: {INDEXER_URL}/v0/prediction-market/participants/{DATA_PROVIDER}/rewards")
print(f" Val Rewards: {INDEXER_URL}/v0/prediction-market/participants/{VALIDATOR_ADDR}/rewards")
print(f" Settlements: {INDEXER_URL}/v0/prediction-market/participants/{BUYER_TAKER_ADDR}/settlements")
print("=" * 60)

if __name__ == "__main__":
main()
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