Skip to content

betting-bots.md

Latest commit

 

History

History
240 lines (163 loc) · 8.99 KB

betting-bots.md

File metadata and controls

240 lines (163 loc) · 8.99 KB

Betting Bots Setup

This document explains how to configure the environment variables required for the Betting Bots feature in PredictOS.

Overview

The Betting Bots feature includes the Polymarket 15 Minute Up/Down Arbitrage Bot, which automatically places limit orders on Polymarket's 15-minute up/down markets to capture arbitrage opportunities.

Two modes available:

  • Vanilla Mode — Single price straddle at a fixed probability level
  • Ladder Mode — Multi-level orders across a price range with exponentially tapered allocation

🚀 More bots coming soon!

Why It Works

📖 Reference: x.com/hanakoxbt/status/1999149407955308699

This strategy exploits a simple arbitrage opportunity in binary prediction markets:

  1. Find a 15m crypto market with high liquidity
  2. Place limit orders: buy YES at 48 cents and NO at 48 cents
  3. Wait until both orders are filled
  4. Total cost: $0.96 for shares on both sides

Regardless of the outcome, one side always pays out $1.00 — guaranteeing a ~4% profit per trade when both orders fill.

The Math

Scenario Cost Payout Profit
"Yes" wins $0.48 (Yes) + $0.48 (No) = $0.96 $1.00 +$0.04 (~4.2%)
"No" wins $0.48 (Yes) + $0.48 (No) = $0.96 $1.00 +$0.04 (~4.2%)

The bot automates this process every 15 minutes, placing straddle limit orders on both sides of the market to capture this arbitrage when both orders fill.

Ladder Mode

📖 Reference: x.com/hanakoxbt/status/1999149407955308699

🎬 Demo by community contributor: x.com/mininghelium1/status/2002399561520656424

Ladder Mode improves on the vanilla strategy by spreading your bankroll across multiple probability levels with exponentially tapered allocation — heavy at the top, light at the bottom. This approach maximizes fill rates and captures more arbitrage opportunities.

How It Works

Instead of placing a single straddle at one price (e.g., 48%), Ladder Mode places orders at every probability level from your configured Top Price (e.g., 49%) down to your Bottom Price (e.g., 35%):

Price Level Allocation Fill Likelihood Profit if Filled
49% ~25% of bankroll Most likely ~2% profit
48% ~18% of bankroll Very likely ~4% profit
47% ~14% of bankroll Likely ~6% profit
... Tapers down ... ...
35% ~1% of bankroll Rare ~86% profit

Why Ladder Mode?

  • Higher fill rates — Top rungs (49%, 48%) fill frequently for steady, consistent gains
  • Larger upside — Lower rungs occasionally fill for much higher profit margins
  • Better capital efficiency — Exponential taper concentrates most capital where fills are likely
  • Automatic rung adjustment — If your bankroll is too small, the bot automatically reduces the number of rungs to ensure each order meets Polymarket's minimum 5-share requirement

Configuration Options

Parameter Description Default
Top Price Highest probability level (receives most allocation) 49%
Bottom Price Lowest probability level (receives least allocation) 35%
Taper Factor Controls allocation curve steepness (1.0 = gentle, 2.5 = aggressive) 1.5
Total Bankroll USD amount distributed across all ladder rungs per market $50

Taper Factor Explained

The taper factor controls how aggressively allocation decreases from top to bottom:

  • 1.0 (Gentle) — More even distribution across all price levels
  • 1.5 (Moderate) — Balanced approach (recommended)
  • 2.0 (Aggressive) — Heavy concentration at top prices
  • 2.5 (Very Heavy Top) — Most conservative, majority at highest fill probability

Community Credit

Ladder Mode was contributed by the community:

Contributor Links
Mining helium 𝕏 @mininghelium1 · GitHub @fciaf420 · Demo

Required Environment Variables

Add these to your supabase/.env.local file:

1. Polymarket Wallet Private Key (Required)

POLYMARKET_WALLET_PRIVATE_KEY=your_wallet_private_key

What it's for: This is the private key of your Ethereum wallet that will be used to sign transactions on Polymarket.

How to get it:

  1. Create an account on P https://polymarket.com
  2. profile drop-down -> settings -> Export Private Key
  3. ⚠️ IMPORTANT: Never share your private key or commit it to version control

🔒 Security Best Practice: Create a dedicated wallet for bot trading with only the funds you're willing to risk. Never use your main wallet's private key.

2. Polymarket Proxy Wallet Address (Required)

POLYMARKET_PROXY_WALLET_ADDRESS=your_proxy_wallet_address

What it's for: This is your Polymarket proxy wallet address, which is used for placing orders on Polymarket's CLOB (Central Limit Order Book).

How to get it:

  1. Create an account on https://polymarket.com
  2. Your proxy wallet will be created automatically
  3. profile drop-down --> under username --> click copy

💡 Note: The proxy wallet is different from your main wallet. It's a smart contract wallet that Polymarket creates for you to interact with their order book.

Complete Example

Your supabase/.env.local file should include these for betting bots:

# Polymarket Bot Configuration - Required for Betting Bots
POLYMARKET_WALLET_PRIVATE_KEY=0x...your_private_key_here
POLYMARKET_PROXY_WALLET_ADDRESS=0x...your_proxy_wallet_address_here

Frontend Environment Variables

In addition to the backend variables above, you need to configure the frontend (terminal/.env):

SUPABASE_URL=<API URL from supabase status>
SUPABASE_ANON_KEY=<anon key from supabase status>

# Edge Function URL (for local development)
SUPABASE_EDGE_FUNCTION_BETTING_BOT=http://127.0.0.1:54321/functions/v1/polymarket-up-down-15-markets

Full Environment File

If you're using both Market Analysis and Betting Bots, your complete supabase/.env.local should look like:

# ============================================
# Market Analysis Configuration
# ============================================

# Dome API - Required for market data
DOME_API_KEY=your_dome_api_key

# AI Provider - At least one is required
XAI_API_KEY=your_xai_api_key
OPENAI_API_KEY=your_openai_api_key

# ============================================
# Betting Bots Configuration
# ============================================

# Polymarket Bot - Required for Betting Bots
POLYMARKET_WALLET_PRIVATE_KEY=0x...your_private_key
POLYMARKET_PROXY_WALLET_ADDRESS=0x...your_proxy_wallet

Verification

After setting up your environment variables:

  1. Start the Supabase services:

    cd supabase
supabase start
supabase functions serve --env-file .env.local

  2. Start the frontend:

    cd terminal
npm run dev

  3. Navigate to http://localhost:3000/betting-bots

  4. Configure your bot parameters and start the bot to test

Bot Parameters

Vanilla Mode Parameters

Parameter Description Default
Asset Symbol The cryptocurrency to trade (BTC, ETH, SOL, XRP) BTC
Order Price Probability level for straddle orders 48%
Order Size Amount in USDC per bet on each side $25

Ladder Mode Parameters

Parameter Description Default
Asset Symbol The cryptocurrency to trade (BTC, ETH, SOL, XRP) BTC
Top Price Highest probability level (heavy allocation) 49%
Bottom Price Lowest probability level (light allocation) 35%
Taper Factor Allocation curve steepness (1.0-2.5) 1.5
Total Bankroll Total USD distributed across all rungs $50

Troubleshooting

Error Solution
"Private key not configured" Add POLYMARKET_WALLET_PRIVATE_KEY to .env.local
"Proxy wallet not configured" Add POLYMARKET_PROXY_WALLET_ADDRESS to .env.local
"Invalid private key" Ensure your private key is correctly formatted (with or without 0x prefix)
"Insufficient balance" Fund your Polymarket wallet with USDC
"Order failed" Check that your proxy wallet is properly set up on Polymarket

Security Considerations

⚠️ Important Security Notes:

  1. Never commit your private key to version control
  2. Use a dedicated trading wallet with limited funds
  3. Keep your .env.local file in .gitignore
  4. Monitor your bot regularly for unexpected behavior
  5. Start with small amounts until you're confident in the bot's behavior

← Back to main README