Collateral Tokens
Beforehand uses a unique token model where each market has its own position tokens.
Token Design
Each market has two ERC20 tokens:
- yUSDC: Represents YES positions
- nUSDC: Represents NO positions
These are separate contracts, one per market.
How They Work
Trading
When you buy a YES position:
- You send USDC to the market contract
- The contract mints yUSDC tokens to your address
- The amount of tokens depends on current pool size and your trade amount
Position Tracking
Your position = your token balance
- If you have 100 yUSDC tokens, you have a YES position
- Token balance directly represents your stake
- You can see your position by checking token balance
Redemption
When market resolves:
- Winners: Redeem tokens for USDC (proportional to pool)
- Losers: Tokens become worthless (cannot redeem)
Benefits
- Transparency: Token balances are public on-chain
- Standard: Uses ERC20, compatible with wallets and DEXs
- Flexible: Could enable token transfers (though UI doesn't support this)
- Verifiable: Users can verify positions independently
Token Math
The number of tokens you receive depends on:
- Your trade amount
- Current pool size
- Total supply of tokens
This ensures fair distribution and proportional ownership of the pool.