Lighter, a decentralized order-book exchange, may be preparing support for prediction markets, according to a recent code repository commit labeled "Binary options support." The change suggests its ZK Circuits may already be set up to handle binary-outcome markets.
Code points to capped pricing and binary settlement
Based on the code, each market has a settlement cap, with 100 described as the typical cap for a prediction market. Shares would trade between 0 and that cap, and the market would ultimately settle at either 0 or the cap depending on the outcome.
The mechanism is fully collateralized in USDC and does not support leverage. That means the structure described would not carry liquidation or forced-close risk.
Implementation may also support continuous settlement
One design detail stands out in the implementation: the Circuits appear to support continuous market settlement. In other words, a market result could settle at any value between 0 and the cap.
That would expand the model beyond standard yes-or-no events and allow contracts tied to measured real-world data. The analysis gave one possible example: a no-liquidation prediction market based on an IPO valuation range. In that setup, users would take positions on a company’s IPO pricing result, and the final payout would be calculated linearly according to where the actual valuation lands within the range, with minimum and maximum returns set at the boundaries.
Whitelist market operators may handle creation and settlement
The report also highlighted a possible market creation and settlement structure. According to the analysis, Lighter may introduce a "market operator" model that would let whitelisted operators create, manage, and settle markets, similar to the HIP-3 deployment model.
If that design is adopted, Lighter’s prediction markets would not necessarily be created entirely by the platform itself. Instead, market categories could be expanded through authorized operators.