Prediction Markets Terms of Use
Luno Prediction Markets: the Rules
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1. ACCEPTANCE OF TERMS
The following Terms and Conditions (the “Prediction Terms”) apply, in addition to Luno’s standard Terms of Use, to any person that utilizes Luno’s prediction markets product (“Prediction Markets”) through Luno.com or any associated mobile applications, website, or APIs (together, the “Luno Site”). Defined terms used but not specifically defined in the Prediction Terms shall bear the meaning ascribed thereto in Luno’s standard Terms of Use.
The Prediction Terms are an addendum to, and therefore form part of, the above mentioned Terms of Use. The Prediction Terms accordingly constitute a legally binding agreement between you and the Luno entity with whom you have contracted under Luno’s Terms of Use. If a matter is not specifically provided for in the Prediction Terms, they will be regulated by the Terms of Use. If any conflict is identified between the Prediction Terms and the Terms of Use, then the provisions of the Prediction Terms will prevail. Repetition in the Prediction Terms of certain but not all of the provisions of the Terms of Use is for emphasis only and should not be interpreted as meaning that the provisions of the Terms of Use that have been omitted do not apply.
For the purposes of the Prediction Terms, any reference to “we”, “us”, “our”, “Luno” and/or any similar term shall be construed as reference to the Luno entity with whom you are contracting.
By utilising Prediction Markets, you unconditionally accept the Prediction Terms and agree to be bound by and act in accordance with them. You also accept and agree that you are solely responsible for understanding and complying with all laws, rules, regulations and requirements of the jurisdiction in which you live that may be applicable to your use of Prediction Markets, including but not limited to, those related to taxation, exchange control, or foreign currency transactions.
Prediction Markets is operated and arbitrated by Limitless on the Base blockchain as Luno’s third party partner.
Please read the Prediction Terms carefully before using Prediction Markets because they affect your legal rights and obligations.
2. AMENDMENT OF TERMS
Luno may amend the Prediction Terms from time to time. You should visit the Luno website regularly to check when the Prediction Terms were last updated and to review the current Prediction Terms. We will do our best to notify you of any amendments to the Prediction Terms that we consider likely to materially affect your rights and obligations. Any such notice will be posted on the Luno Site, or sent by email to the email address associated with your Luno Account.
The continued use of Prediction Markets, after any amendment to the Prediction Terms, constitutes your acceptance of the Prediction Terms, as modified by such amendment. If you do not accept the Prediction Terms, or any amendment to them, you must immediately stop using Prediction Markets.
In addition, Luno reserves the right to add additional financial markets over time, with the underlying crypto assets always being Supported Crypto Assets available on the Luno platform.
3. PREDICTION MARKETS
Prediction Markets allows you to participate in financial contracts in supported crypto asset markets on the Base blockchain (the “Supported Markets”). In order to participate, you are required to commit USDC to the Base blockchain via our third party partner, Limitless, for shares in the price events of the Supported Markets.
When you use Prediction Markets, you agree to use Luno’s prediction markets wallet infrastructure and, by doing so, Luno will give effect to your instructions to commit your USDC to the Base blockchain. As a result, you will have the opportunity to participate in price events in the Supported Markets, subject at all times to the Prediction Markets rules.
The Supported Markets are made available in the Luno App, with the binary option to trade “ABOVE” or “BELOW” on your chosen Supported Market’s price event (e.g. "Will BTC end above or below $100k at the end of today?"). On making a selection, you are purchasing shares, denominated in USDC, in the price event. Your shares in the chosen Supported Market represent shares in that contract on the Base blockchain that pays out a fixed amount of USDC on the outcome of the Supported Market’s price event.
When you use Prediction Markets, you are required to buy USDC or to transfer USDC from your ordinary USDC wallet to your dedicated predictions wallet (the “Predictions Wallet”), which is separate from your ordinary USDC wallet, but remains within Luno’s custody on your behalf. When using Prediction Markets, minimum and maximum purchase amounts will apply.
Even though we use a third party partner to offer Prediction Markets, the USDC held in your Predictions Wallet is not transferred to a third party. Luno will continue holding this USDC on your behalf and you remain the legal owner of your USDC in accordance with our Terms of Use.
4. PREDICTION MARKETS RULES
Prediction Markets operates via Limitless’ peer-peer decentralised exchange on the Base blockchain, and Luno does not determine the rules which govern how the Supported Markets operate on the Base blockchain. By using Prediction Markets, you accept and agree to the following:
Commitment period: when you buy or sell USDC shares in the Supported Market, your USDC leaves Luno's custody and is committed to the Base blockchain for the duration of the Supported Market’s price event. You are able to buy or sell USDC shares in the Supported Market up to 1 minute (60 seconds) before the market closes. You acknowledge that crypto assets are highly volatile and their value can fluctuate. Luno is not liable for any losses that you suffer as a result of price fluctuation of crypto asset prices during the period when your USDC is committed to the Base blockchain.
Loss: where your trade in the price event of your chosen Supported Market is wrong, your shares fall to 0.00 USDC and you will lose the total amount of USDC you traded.
Position restrictions: you cannot hold conflicting positions (i.e. both “ABOVE” and “BELOW”) simultaneously, nor can you "double down" (i.e. engage in subsequent buys) on the Supported Markets.
5. PREDICTION MARKETS SETTLEMENT
The outcome of a Supported Market(s) is determined by the decentralised infrastructure on the Base blockchain that Limitless uses, called the Pyth Network. The Pyth Network provides data feeds and points and once conditions on the Supported Market are met, the Supported Market closes. Based on the Pyth Network’s data, settlement and distribution of USDC payout automatically executes on the Base blockchain to winning customers. There is no manual intervention by Luno nor Limitless.
You acknowledge and agree that the data Limitless uses from the Pyth Network automatically determines the market outcome. In the event of a dispute, Limitless shall act as the arbitrator.
You acknowledge and agree that any determination made by Limitless, as arbitrator, is final and binding and Luno shall automatically rely and give effect to the determination. To the maximum extent allowed by law, you have no right of recourse against Luno and/or Limitless for the accuracy, timeliness, or validity of a market outcome or the resulting final determination by arbitration;
Neither Luno nor Limitless shall be liable for any losses, including those resulting from delays, failures, errors, omissions or loss of transmitted data on the Pyth Network or Base blockchain;
All settlements are final. Neither Luno nor Limitless can reverse, modify, or cancel a settlement once it has been executed on the Base blockchain.
To the maximum extent allowed by law, Luno, its licensors, employees, contractors, agents, suppliers and vendors shall bear no liability for any injury, damages or losses – whether direct or indirect, consequential, incidental, punitive, and whether arising out of negligence or otherwise – arising in connection with Prediction Markets, or any data or values relating thereto, including in respect of settlement and arbitration.
6. PREDICTION MARKETS PAYOUTS
On execution of your USDC trade, the USDC available in your Predictions Wallet will be committed to the Base blockchain via Limitless and you will hold shares representing your position in your chosen Supported Market. Each share represents a potential claim of 1.00 USDC. You may realise the value of your shares in one of two ways:
Early Exit: you may sell back your total USDC shares traded at the prevailing market price up to 1 minute (60 seconds) before your chosen Supported Market closes. You cannot sell a portion of your USDC shares; you must sell all your USDC shares in order to exit early.
Final Settlement: you may hold your USDC shares until the market closes and if your trade is correct, you may claim your payout in USDC from the Base blockchain. Each winning share will settle at a value of 1.00 USDC.
In either event, Luno will credit your Predictions Wallet with your USDC payout, less applicable fees.
If you do not claim your payout within 30 days, it will automatically be allocated to your Predictions Wallet.
7. RISK OF LOSS
The USDC held in your Predictions Wallet represents your available balance to trade in the Supported Markets. When you execute a USDC trade, the specified amount of USDC is deducted from your available balance and committed to the Base blockchain via Limitless to purchase shares in your chosen Supported Market. If you -
elect not sell your shares before the market closes; OR
if you hold your USDC until your chosen Supported Market closes and your position is incorrect
Your shares will settle at a value of 0.00 USDC and your initial USDC trade amount will be automatically reallocated to the liquidity pool of winning customers.
By using the Prediction Markets Product, and to the maximum extent allowed by law, you acknowledge and agree that you are aware of this risk and agree that neither Luno nor Limitless are liable for any loss you may incur whatsoever.
8. WITHDRAWALS
You are able to withdraw the USDC balance available in your Predictions Wallet (together with any USDC payouts) at any time to your ordinary USDC wallet. Your Predictions Wallet will be debited with the value of USDC, whilst your ordinary USDC wallet will be credited commensurately.
While in the Predictions Wallet, USDC cannot be sold, transferred, or otherwise used for transactions until transferred back into your ordinary USDC Wallet.
9. FEES
You acknowledge and agree that, as consideration for developing and making Prediction Markets available to you, Luno will earn fees payable by you. The fees and costs can be viewed on the Fees page of the Luno website. We reserve the right to change our fees and costs at any time (in our discretion and without formal notice to you) and will update the Fees page accordingly.
You acknowledge and agree that Luno may earn commission from your trades on the Base blockchain, via Limitless.