The market calculation
Losses follow the adverse market move times leverage, capped by the bet’s collateral; a recorded liquidation crossing loses the entire margin. For positions opened under economics v1, all markets use the ETH asymmetric-impact curve with no deadband. Tiny favorable moves can earn positive profit, subject to integer rounding.
Let m be the absolute favorable price change divided by entry price, expressed as a fraction, and G be eligible collateral value × leverage × m. Profit is G × 0.9 ÷ (1 + 1/(15000 × m) + 100000/(1000000 × m × 483.979)) × 0.98. The $100,000 reference is fixed; the haircut percentage does not change with trade size. Each contract calculation rounds conservatively in whole atoms.
The final 2% reduction applies to profit after impact, not to returned collateral. It reduces the amount owed by the payout pool; it is not separately sent to stakers. Positions opened before the immutable activation timestamp retain their original profit calculation, including its 0.002% deadband. Finalized claims keep their recorded amounts.
Winning collateral adjustment
A winning claim is scaled by the lower of 1 and closing collateral value ÷ opening collateral value. If the bag is worth half as much at close, the otherwise eligible profit is halved. Winning does not by itself consume backing.
Losing collateral adjustment
Backing covers the depreciation attributable to the lost fraction, using available locked $SDICE. It does not reimburse depreciation on the portion the trader keeps. Consumed backing is added to the payout pool and earns ownership for the trader.
If the required cover exceeds available backing, close anyway, record the shortfall and leave no user debt. This caps what can be collected from backing; it does not eliminate pool risk.
Backing capacity is before leverage
$100 of eligible backing supports up to $100 of opening bet value across backed positions. At 1000× that can mean $100,000 of synthetic exposure, subject to other limits. Falling backing value triggers oldest-first risk reduction. SOL, USDC and $SDICE are exempt.