> For the complete documentation index, see [llms.txt](https://pred-1.gitbook.io/pred-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://pred-1.gitbook.io/pred-docs/background-and-narrative.md).

# Background & Narrative

For decades, **sports betting/predictions** has been trapped inside a rigid, outdated model of **sportsbooks**.

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In that world, the bookmaker controls the odds and the margins are fat. As a result, the user suffers and is always on the wrong side of the spread.

A typical sportsbook charges a **6–15% VIG (house edge)** to cover its position risk.\
By comparison, a stock exchange charges about **minimal brokerage**, with spreads so thin they’re nearly invisible.

> This gap between gambling and trading is a **$140 billion industry** begging to be disrupted.

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### The History

In the early 2000s, pioneers like **Betfair** tried to flip the model. They removed the bookmaker entirely creating peer-to-peer sports exchanges where buyers and sellers could match directly, like traders on NASDAQ.

It worked in theory, but **regulation fractured liquidity** across regions. Without global pools of capital, spreads stayed wide and the disruption couldn't occur.

#### No House, No Odds-Maker

Traditional sportsbooks operate with a built-in house edge (vig), typically ranging from **6–15%**. The bookmaker sets the odds, manages risk, and profits regardless of player success.Over time, it penalizes skill — and that’s not a sustainable market.

On **PRED**, **we remove the bookmaker entirely**.

* We do **not** act as the house or take the opposite side of your trade
* All prices emerge from **supply and demand between users**
* You trade **directly against other participants**, not the platform

**We do not lose money when users win**:

* We place **no limits** on profitable traders
* We **do not ban** users for consistent success
* Our incentives are aligned toward **deep liquidity and fair price discovery**

We generate revenue through **low, exchange-style fees;** not through user losses.

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### The Problem 

When people **bet**, they focus on entertainment.\
When people **trade**, they focus on **spreads and liquidity**.\
A trader won’t touch a market that’s illiquid but most betting markets are exactly that.

Because of high spreads and low depth, sports bettors can’t **enter and exit** dynamically.\
They’re forced to hold their view until the game ends, instead of **trading the movement** of probabilities in real time.

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### Our Mission

**PRED** exists to change that.\
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We’re transforming sports betting from a **gambler’s market** into a **trader’s market** where odds become prices, games become charts, and skill replaces luck.

Our mission is to build a **high speed, performant exchange** that lets you build and manage your **sports portfolio** the same way you’d trade stocks, crypto, or options.

Deep liquidity at near-zero spreads (resulting in best odds) are our **holy grail** because when spreads vanish, trading thrives, and prediction finally becomes a true asset class.<br>

> Every major asset class has a liquid, global market.\
> It’s time sports predictions had one too.