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Trade any observable, volatile value

Price markets are not limited to crypto assets. They let you take long or short exposure to any observable value that can be represented by a reliable oracle or market data source. A market can track a familiar asset, such as BTC-USD, ETH-USD, a stock, gold, or a commodity. It can also track a real-world index or continuously changing reference value, such as a housing index, inflation index, second-hand goods price, or another numerical signal that updates over time. You choose:
  • the market you want to trade
  • collateral amount
  • long or short direction
  • leverage
Price markets are onchain pool markets, not centralized order books. Active markets can be traded 24/7 while the chain, oracle, and pool state allow normal operation. TACO is not trying to mirror a low-latency CLOB exchange. You trade against a shared collateral pool, and the contract uses oracle prices to value positions.

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How positions are priced and valued

TACO price markets are not a constant-product (x*y=k) AMM. There is no bonding curve, and the size of the pool does not move your fill price: your entry price, mark price, and close price are all the market’s oracle price at execution time. The only slippage protection is an optional price band (a minimum payout or oracle bounds) you can attach when closing. Your position value is not shares * share price. It is derived from your collateral, direction, leverage, entry price, and the latest oracle price, and then scaled by a pool-level solvency adjustment called psi (ψ):
  • Raw value reflects the price move on your leveraged exposure, floored at zero — you can never lose more than your deposited collateral.
  • Adjusted value is the raw value after psi is applied, so the shared collateral pool can stay solvent across every open long and short. Payout is also capped by the pool’s available collateral.
Internal “pool shares” do exist, but they are an LP accounting unit — how liquidity claims on the pool are minted and redeemed. They are not how your trader position is valued. See Price market liquidity.
This is why a TACO price position is not just a bet on whether the oracle price goes up or down. Your value also depends on psi and the state of the shared pool while the position is open.

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Long and short

A long position benefits when the oracle price rises. A short position benefits when the oracle price falls.
A long position and a rising oracle price do not guarantee profit. Position value also depends on shares, share price, psi, fees, pool state, and execution price. See Technical Details for the full model.
Your position is not a spot swap. It is a collateralized prediction position inside a shared pool. Your payout depends on the price move, leverage, pool state, fees, and solvency adjustment.

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Funding

TACO price markets do not use the traditional long/short funding loop — there is no periodic payment swapped between longs and shorts. Some markets can enable an optional trader-to-LP funding charge (off by default, configured per market by a risk role). When it is enabled, traders pay funding into the LP pool based on how much trader exposure the pool carries relative to LP value, with the crowded (majority) side paying a skew premium and the minority side receiving a discount. Funding is taken from your margin and can reduce your payout and health while a position is open. Fees can also adjust based on market imbalance, but dynamic fees are not the same as funding. If many traders crowd the same direction, opening or increasing that exposure can become more expensive. Trades that reduce pool imbalance can receive a lower effective fee when the market configuration allows it.

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Shared pool collateral

Each market has a collateral pool. Traders and liquidity providers interact with the same pool accounting, while LP reward rights are tracked separately when fee sharing is enabled. This shared model is why position value can depend on more than just your entry price and the latest oracle price. Psi is part of that pool accounting. It helps align payouts with the pool’s available collateral, so a close preview can differ from a simple price-change calculation.