> For the complete documentation index, see [llms.txt](https://whitepaper.earn.network/en/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://whitepaper.earn.network/en/prediction-markets/business-model.md).

# Business Model

Market Creators make a final decision about the % of fees they wish to impose within the prediction market (the min value is 5%). This fee structure has certain rules and ratios put in place to ensure fairness and good incentives for every participant. Let's go through a simple case where the amount of winnings is 2000 USDT and the market fee was set to 5% by the Market Creator. This gives us a $100 market fee (since 1900 USDT winnings are divided pro-rata to Stakers/Bettors):

**Market Creator (30%):** 30 USDT

**Earn Network Treasury (30%):** 30 USDT

**Market Validators (13%):** 12.5 USDT total is split pro-rata for all market validators that suggested the correct outcome.

**Yield for stakers of $EARN token in staking pools (10%):** 10 USDT is transferred to the main staking pools in the form of $EARN token as a reward.

**Incentives for Bettors and Market Creators (5%):** 5 USDT is transferred to a dedicated wallet which will be used to distribute rewards to top bettors and best market creators.

**Buy-back mechanism (2.5%):** 2.5 USDT is transferred to a dedicated wallet which will be used to purchase $EARN from the open market and burn it.  

**Burn mechanism (2.5%):** 2.5 USDT is transferred to a dedicated wallet which will be used to purchase $EARN from the open market and burn it.  

**Oracle of Wisdom NFT Holders (6.7%):** 6.7 USDT will be added as rewards to the NFT staking pool.

**Golden Tree of Fortune NFT Holders (0.3%):** 0.3 USDT will be added as rewards to the NFT staking pool.

Please note, the breakdown might change before we 'go-live' and thereafter. Adjustments might be needed on the live system to validate proper assumptions, ensuring that they provide enough incentives for every party in the practical, operating system.

**Trading Bets**

Our trading model will utilize a ranged dynamic fee based on the probabilities of the outcomes. Lower-probability outcomes will have a lower fee, while the most popular ones will be charged a higher fee.