What Is Neostake?

Neostake is a digital platform for student prediction markets. It allows students to forecast outcomes of relevant topics such as campus events, exams, politics, or cultural developments.

Unlike financial platforms, Neostake is entirely stake-based. Market prices are calculated automatically using the Logarithmic Market Scoring Rule (LMSR), which guarantees liquidity, fairness, and transparency.

Neostake is not a betting or money-making platform. Stakes have no cash value. The platform exists purely for learning, entertainment, and community building.

What Is a Prediction Market?

A prediction market is a marketplace where users trade on the outcome of future events. Instead of buying physical goods, they buy shares in outcomes (possible answers to a question).

• If an outcome resolves as correct, its price goes to 1, and holders receive payouts in Stakes.

• If an outcome is incorrect, its price goes to 0, and those shares lose their value.

The price of each outcome during trading reflects the collective belief of all users about how likely it is to happen.

Prediction markets are commonly used to forecast elections, sports results, or economic indicators. Neostake brings this concept to universities, making forecasting accessible, playful, and educational.

Why Are We Building Neostake?

• Practical learning: Students gain a hands-on introduction to economics, probability, and forecasting models.

• Campus engagement: Markets create discussions and debates, bringing people together in a dynamic way.

• Community: Forecasting builds shared experiences and sparks conversation.

• Partnerships: Sponsors can engage students through innovative, risk-free exposure.

Who Is Neostake For?

• Students: Compete in markets, climb leaderboards, and test their knowledge.

• Student councils: Strengthen participation and campus life by supporting markets.

• Partners & sponsors: Reach a young, active audience in a transparent environment.

How Neostake Works

Markets

A market is the central event being traded on.

• Each market represents one clear question (e.g., “Will the Mensa serve vegan gyros on Friday?”).

• Markets are created by users but must pass an upvote process to ensure enough interest.

Outcomes

An outcome is a possible answer to a market’s question.

Good Examples (Exam / Average Grade Markets)

Market: “What will be the average grade in the ‘Statistics I’ exam (WiSe 2025)?”

• Outcome A: “1.0 - 1.7”

• Outcome B: “1.8 – 2.3”

• Outcome C: “2.4 – 3.0”

• Outcome D: “3.1 or worse”

Current Stakes vs. Standard Stakes

• Current Stakes: A weekly grant of 1,000 Stakes.

  • Unused Current Stakes do not count toward Net Worth.

  • Once traded, they are included immediately as the MTL value of your open position.

  • Any unused Current Stakes expire at the end of the week.

• Standard Stakes: Your permanent Stakes that never reset and always count toward Net Worth.

Net Worth

Your Net Worth is the single number that measures your performance.

It is calculated as:

NetWorth = Standard Stakes + Σ (MTL of all open positions) 

• Standard Stakes: your permanent Stake holdings, always included.

• Open positions: all shares you own, valued continuously via LMSR (mark-to-liquidation).

• Unused Current Stakes: excluded until you use them in a trade.

Important: Net Worth does not jump when you sell. It jumps when you buy with Current Stakes, because unused Current (ignored) becomes an active position (counted).

Key Market Dates

• Upvote Deadline

  • New markets need at least 30 upvotes within 4 days to go live.

  • If not reached, they are archived (visible but inactive).

• Market Close Date

  • Last day to trade shares.

  • After this, the market freezes for resolution.

• Market Resolution Date

  • By this date, the Oracle determines the correct outcome.

  • If unresolved, all trades are refunded.

Risk of Market Manipulation

Markets can be distorted if only a few users hold most of the Stakes (“shark problem”). To address this:

• Neostake calculates a Market Manipulation Risk Score for every market.

• It considers:

  • Number of unique users

  • Trading volume

  • Share of volume held by the largest users

The score is displayed in Market Details for full transparency.

Who Resolves Markets? – The Oracle

Neostake uses a community-based Oracle:

• After a market closes, users vote on the correct outcome.

• A minimum 5% margin between the top two outcomes is required.

• If no margin exists, or if no votes are submitted, all trades are refunded.

Incentives to Vote Honestly

• Correct vote (with majority) → positive leaderboard multiplier.

• Incorrect vote (against majority) → negative multiplier (penalty stronger than reward).

• If unsure → better not to vote.

Summary

• Neostake = stake-based student prediction markets

• Prediction market = trading outcome shares to forecast events

• Markets & outcomes = core structure of the platform

• Stakes = Current (weekly grant, expires if unused) and Standard (permanent)

• Net Worth = Standard Stakes + open positions (MTL), unused Current excluded

• Leaderboards = based on percentage change in Net Worth each week

• Dates = upvote deadline, close date, resolution date

• Manipulation risk = calculated and displayed transparently

• Oracle = community voting with 5% rule + honest-voting incentives