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Glossary

Plain-English definitions for the terms you'll see across EdgeLedger and the predictive market platforms it tracks. Filter by name, alias, or definition text.

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A short reference for the terms you'll see across EdgeLedger and the prediction-market platforms it tracks. Each entry is a plain-English definition; many link out to longer guides if you want the full treatment.

The list is filterable — type any part of a term, alias, or definition into the search box. Each entry has a stable anchor link (e.g. #uma), so you can deep-link to a specific definition from anywhere on the site.

27 terms

  • ACH

    Also: Automated Clearing House, bank transfer

    The US bank-rail system used for moving USD between bank accounts. Kalshi supports ACH for eligible US bank funding and withdrawals; international users may need other rails such as debit card, wire, or crypto depending on region.

    Learn more: Getting started with Kalshi

  • AMM

    Also: automated market maker, constant product

    A market mechanism that quotes prices from a formula and an inventory pool rather than a list of resting orders. Constant-product AMMs (x × y = k) are the most common shape; the YES price moves continuously as the YES inventory drains. Used by some Polymarket markets and many DeFi venues.

    See also: Order book, Slippage, Liquidity

    Learn more: Liquidity, slippage, and order book vs AMM

  • Calibration

    Also: forecast calibration

    A measure of how well your stated probabilities match observed outcomes. Well-calibrated means: of the things you said were 70% likely, about 70% actually happened. Calibration matters more than apparent edge — a 60% claimed probability that's really 50% turns +EV trades into break-even or worse.

    See also: Edge, EV

    Learn more: Risk management for predictive market trading

  • CFTC

    Also: Commodity Futures Trading Commission

    The US federal regulator overseeing futures, options, and event-contract markets. Kalshi operates as a CFTC-regulated Designated Contract Market (DCM); its event contracts are listed under CFTC oversight rather than as crypto or offshore products.

    See also: DCM, Kalshi

    Learn more: Getting started with Kalshi

  • CLOB

    Also: central limit order book, order book

    A market mechanism that matches resting buy and sell orders sorted by price. Buy market orders fill against the best ask first, then walk into worse prices; limit orders rest in the book until matched. Used by Kalshi end-to-end and by most actively traded Polymarket markets.

    See also: AMM, Order book, Slippage

    Learn more: Liquidity, slippage, and order book vs AMM

  • DCM

    Also: Designated Contract Market

    A category of US-regulated derivatives exchange under CFTC oversight. Kalshi is a DCM; this is the regulatory framing that makes its event contracts US-domiciled financial instruments rather than offshore or crypto products.

    See also: CFTC, Kalshi

  • Depth

    Also: book depth, market depth

    The total size resting at each price level in an order book. A market with $5,000 sitting at the best ask has more depth than one with $200; deeper markets fill larger orders without walking into worse prices. Depth is a more useful sizing input than the headline top-of-book price.

    See also: Liquidity, Slippage, Spread

    Learn more: Liquidity, slippage, and order book vs AMM

  • Edge

    The gap between your probability estimate and the market's price (which reads as the market's implied probability). A 10-point edge at a 40¢ price means you think the event is 50% likely. Edge drives EV — and is the input most often overestimated in practice.

    See also: EV, Implied probability, Calibration

    Learn more: Reading prices and expected value

  • EV

    Also: expected value

    The probability-weighted average payoff of a trade — the long-run number you'd realise per contract if you could repeat the same trade many times. For a binary contract: EV = (yourProbability - marketPrice) x $1, before fees. Positive gross EV still needs fees, slippage, variance, and sizing considered separately.

    See also: Edge, Implied probability, Calibration

    Learn more: Reading prices and expected value

  • Kalshi

    A CFTC-regulated, US-domiciled event-contract exchange. Custodial; runs a central limit order book end-to-end; uses cents pricing and $1 contract payouts. Funding, withdrawal rails, eligibility, and tax documents depend on account type, country, activity, and reporting thresholds.

    See also: CFTC, DCM, ACH, CLOB

    Learn more: Getting started with Kalshi

  • Kelly criterion

    Also: full Kelly, fractional Kelly

    A sizing formula that maximises the long-run growth rate of a bankroll given a known edge. For a binary contract: f = (p - c) / (1 - c), where p is your probability and c is the price. Full Kelly assumes accurate probabilities and can produce large drawdowns; fractional Kelly is often discussed as a lower-variance modeling variant.

    See also: Edge, EV, Calibration

    Learn more: Risk management for predictive market trading

  • Liquidity

    How much size you can trade right now without materially moving the price. A liquid market absorbs large orders at near-quote prices; a thin market produces meaningful slippage on even modestly sized trades. Liquidity is the practical answer to 'can I get this trade done at the price I see?'

    See also: Depth, Slippage, Spread

    Learn more: Liquidity, slippage, and order book vs AMM

  • Manifold

    A predictive market platform that operates with play-money and (in some configurations) real-money markets. EdgeLedger reads Manifold market data alongside Polymarket and Kalshi for cross-venue analytics including the Pro arbitrage scanner.

    See also: Cross-venue arbitrage

  • Oracle

    Also: resolution oracle

    The mechanism that determines a market's outcome at settlement. On Polymarket, the UMA optimistic oracle is used: anyone can propose an outcome, posting a small bond, and the proposal becomes final unless disputed within the challenge window. Kalshi resolves markets internally rather than via an on-chain oracle.

    See also: UMA, Dispute window, Settlement

    Learn more: Reading a Polymarket market page

  • Polygon

    Also: MATIC, Polygon PoS

    An Ethereum-compatible blockchain used by Polymarket for trade execution and custody. POL (formerly MATIC) is used for gas on direct Polygon transactions, while Polymarket's relayer can sponsor gas for supported flows.

    See also: Polymarket, USDC

    Learn more: Polymarket fees, gas, and withdrawals

  • Polymarket

    An on-chain predictive market built on Polygon. Current docs describe pUSD as the trading collateral token backed by USDC; markets typically run on a central limit order book with some AMM-quoted exceptions. UMA optimistic oracle handles resolution. Polymarket US is a separate CFTC-regulated DCM surface.

    See also: UMA, AMM, CLOB, Polygon, USDC

    Learn more: How Polymarket works

  • Resolution source

    Also: source of truth

    The authoritative reference a market consults at settlement to decide the outcome. Specific official documents (e.g. an FOMC statement) are easier to reason about than vague references like 'multiple credible sources.' Treat the resolution-source field as a core contract term.

    See also: Settlement, Oracle

    Learn more: Reading a Polymarket market page

  • Spread

    Also: bid-ask spread

    The gap between best bid and best ask in an order book. On a liquid market this is often 1–2¢; on a thin market it can be 10¢ or more. Spread is functionally a fee — the cost of taking liquidity instead of providing it.

    See also: Liquidity, Depth, Slippage

  • UMA

    Also: UMA optimistic oracle

    The optimistic oracle Polymarket uses to resolve markets. Anyone can propose an outcome with a bond; the proposal is final unless disputed within the challenge window. Disputes go to a UMA token-holder vote, which can take hours to days.

    See also: Oracle, Dispute window, Polymarket

    Learn more: Reading a Polymarket market page

  • USDC

    Also: native USDC, USDC.e

    A US-dollar-pegged stablecoin issued by Circle. Polymarket's current docs describe pUSD as a Polygon collateral token backed by USDC, and older bridge paths may reference native USDC or USDC.e. Check the exact token and network before transferring funds.

    See also: Polymarket, Polygon

    Learn more: Polymarket fees, gas, and withdrawals

  • Yes/No contract

    Also: binary outcome contract, outcome contract

    A binary instrument that pays $1 if its named outcome resolves and $0 otherwise. Each prediction market has two complementary contracts (YES and NO) whose prices sum to roughly $1 plus spread. The price you pay is also the implied probability the market is assigning.

    See also: Implied probability, Settlement, EV

    Learn more: How prediction markets work

How this glossary is maintained

  • Terms live in code. New entries are added to apps/web/src/components/learn/glossary-terms.ts and ship as part of the next release. Each entry is a typed object with the display term, optional aliases, definition, related-term anchors, and optional pointers to longer Learn guides.
  • Slugs are stable. Once a term has a slug it doesn't change — every guide that links to #kalshi or #uma keeps working when the rest of the entry is rewritten.
  • The list grows over time. If something you'd expect to find here isn't, that's a documentation gap rather than a deliberate omission. Open an issue or PR.

Where to go next

If a term sent you here from another guide, jump back to it once you have the gist. Otherwise the natural next reads are: