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  • How Price Imbalances Encourage Trading
  • Maintaining Market Equilibrium
  1. Incentive Behavior

Balanced Market Incentive

How Price Imbalances Encourage Trading

As one token type becomes more expensive:

  • It becomes more attractive to sell these tokens

  • The other token type becomes relatively cheaper, encouraging contrarian bets

Maintaining Market Equilibrium

This mechanism helps prevent extreme imbalances and encourages a diversity of opinions in the market, potentially leading to more accurate predictions.

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Last updated 8 months ago