In a Continuous Double Auction, traders post bids to buy outcome shares and asks to sell them. The system continuously checks whether a bid and an ask line up. When they match, a trade executes instantly, updating the market’s probability for that event.
This model allows prediction markets to react quickly to new information. Prices shift whenever traders adjust their expectations, making the market highly responsive. Because orders can be placed or canceled at any moment, the CDA structure gives participants full control over how they express their beliefs.
CDA markets tend to work best when participation is steady. With enough trading activity, the orderbook fills with prices that reflect shifting expectations. Over time, this generates rich prediction markets data that analysts can use to understand how confidence evolves before major events.
A Continuous Double Auction creates fast, transparent price discovery for prediction markets. It helps markets produce high-quality probability signals by letting traders compete and update prices in real time.
Prediction markets use CDA models because they support rapid, user-driven price formation. Every trader can influence the market directly by placing or adjusting orders. This leads to forecasts shaped by real negotiation rather than formulas. When liquidity is healthy, CDA markets generate detailed prediction markets data that captures sentiment shifts as they occur. This responsiveness makes CDA a strong choice for active forecasting communities.
A CDA influences price behavior by updating the market only when orders match. If buyers raise their bids or sellers lower their asks, the probability moves toward that new agreement point. This creates a clear link between trader behavior and market updates. The continuous nature of the system also reveals how sentiment develops between trades by showing orderbook depth and changes. These elements together produce highly informative prediction markets data.
CDA markets offer greater flexibility because traders control the exact price levels they want to trade at. Unlike automated market makers, which set prices through formulas, CDA markets reflect direct supply and demand for outcome shares. They also provide more granular insight into market sentiment by showing the full spectrum of bids and asks. For analysts, this means access to deeper prediction markets data that can reveal early signals before trades execute. These advantages are especially valuable in markets with strong participation.
A prediction market tracks whether a major software release will be delayed. Traders adjust their bids and asks throughout the week as internal rumors or updates circulate. When a buyer and seller agree on a price, a trade occurs, and the market probability updates instantly.
CDA-based prediction markets generate detailed, moment-by-moment data on bids, asks, trades, and probability changes. FinFeed's Prediction Markets API gives developers structured access to this prediction markets data, making it easy to analyze auction dynamics, build monitoring dashboards, and integrate real-time sentiment signals into forecasting tools.
