Market price.

The two shares trade all day. A pair merges back into $1 at any time, so the two prices sum to about $1. The stress price is the market's live forecast.

What moves the price.

Order flow, nothing else. The venue fixes the claim terms before issuance and leaves valuation to the order book: traders post bids and asks, and the price moves when someone crosses the gap, exactly like a stock. The market price is what traders collectively think a share will be worth at settlement.

How trading works.

Two rules. Trading runs on an order book: post the price you want for sHY or cHY, and matched trades settle on chain against the same escrow that backs every pair. Each new window opens with a single batch auction where all opening orders clear at one price, so both sides get the same fair start.

Why the prices sum to $1.

Anyone can mint a pair for $1 or merge one back into $1, anytime. Suppose sHY trades at 70¢ and cHY at 40¢: mint a pair for $1, sell both sides for $1.10, keep the dime. If together they trade at 90¢, buy both, merge, redeem the $1. That free money is why the two prices cannot drift far from summing to $1. No oracle. No peg.

The opposite side of the market is part of your exit.

A traditional prediction market splits a number into buckets, and each bucket is its own market with its own order book. Exiting your position means finding a buyer inside your one bucket. A trader who agrees with your direction but holds a different bucket cannot take your shares: two people with the same view, walled off from each other. Your executable counterparties are exactly one group, the buyers in your bucket.

Here your exit is not limited to buyers of your side. Merge allows opposite side liquidity to complete your trade. The liquidity does not transform into anything; it becomes executable against your order. A seller of the opposite share and you together hold a complete pair, and a complete pair redeems its escrowed dollar at any time.

The escrow buys nothing. It redeems complete pairs, and that is enough: your sHY plus a stranger's cHY form a pair, the pair redeems its dollar, and each of you takes your sale price out of it. Whenever the other side has an ask, that ask is your bid:

your exit price when the other side is quoting = $1 − the other side's best ask

Worked example. You hold 1,000 sHY and want out. Nobody anywhere is bidding for sHY. But someone is offering 1,000 cHY at 88¢. The venue takes your shares and theirs, merges the 1,000 pairs back into the escrowed $1,000, and splits it: you receive $120, they receive $880, and $120 + $880 = $1,000 exactly. You exited at 12¢ per share against a counterparty who was not thinking about your side of the trade at all. The same works in reverse for buyers: a stress buyer and a calm buyer whose prices sum to at least $1 mint a fresh pair between them.

Liquidity set expansion.

The examples above all illustrate one property, so it deserves a name. Mint and merge enlarge the set of counterparties that can execute a trade.

• In a bucket market, your executable counterparties are the buyers in your bucket. One group.
• Here, your executable counterparties are the buyers of your side, plus the sellers of the opposite side through merge, plus pair minters on the way in. Three groups for the same trading interest.

The second set contains the first, and is strictly larger whenever the opposite side quotes at all. This is a mechanical property of the pair, not a promise about demand: if both sides of the pair are empty, no market can manufacture a counterparty. A bucket board is a set of disconnected books; mint and merge connect this market into one liquidity graph.

The mirror on the way in.

Merge creates exits; mint creates entries, and both are the same property pointed in opposite directions. Suppose stress is bid at 40¢ and calm is bid at 65¢. The two bids sum to $1.05, so anyone can mint a fresh pair for $1, sell into both bids, and keep the nickel. Overlapping demand becomes new supply, without waiting for an existing holder to sell.

How stress gets paid.

Sell into a fear spike, or hold: settlement pays where the index landed either way.