Edge Markets, a financial infrastructure provider for the gaming and prediction markets industries, has announced a new system designed to reduce liquidation risk from margin calls on prediction markets that operate around the clock [1]. The company's latest product, available through its Edge Pro service for market makers, enables institutions to pre-approve how much capital can be deployed on prediction markets and set limits on daily transactions executed by artificial intelligence agents and trading algorithms [1].
The new infrastructure addresses a key challenge in prediction markets: perpetual futures, which trade nonstop, can trigger margin calls outside traditional banking hours, creating a risk of forced liquidations due to the inability to move funds when banks are closed [1]. Edge Markets' payment infrastructure, Edge Connect, allows institutional traders to pre-authorize a clearing house to automatically pull additional collateral in the event of a margin call, even when banking systems are offline [1].
Seni Thomas, founder and CEO of Edge Markets, stated, "Markets are becoming increasingly automated and global, but the infrastructure for accessing and moving capital on prediction markets falls short of real-world demand" [1]. He added that the new system can help reduce avoidable liquidations, improve capital efficiency, and make always-on markets more resilient by allowing firms to establish permissions in advance [1].
The tool is expected to launch later this year and will facilitate the routing of capital and transactions from trades to banks. Edge Markets is partnering with companies such as River Markets, ParlayX, OpenMarkets, and Pikkit, whose clients will have access to the new product [1].
CONCLUSION
Edge Markets' new infrastructure aims to address a significant risk in 24/7 prediction markets by enabling automated collateral management outside traditional banking hours. The initiative is expected to improve capital efficiency and market resilience, with several industry partners set to offer the product to their clients.
