Explanation

Invalid insurance

Invalid shares are held, not traded. This page explains what that buys a trader and what it cannot tell them.

How it works

Each ordinary ETH entry returns one Invalid share for each complete set created. If the question resolves Invalid, the holder redeems those shares with the SecurityPool's redeemShares() at the current collateral value.

Keeping Invalid shares out of the pair removes the on-chain three-reserve quadratic and makes an ordinary entry insured against an Invalid result. The cost is that nothing in the AMM can detect a suspicious market from an Invalid price, because no such price exists.

A worked Invalid result

Alice entered with enough ETH to mint 100 complete-set shares, received 190 Yes after her swap, and kept 100 Invalid. The market resolves Invalid. The pair's Yes and No balances do not become valuable merely because they are nonzero. Alice redeems her 100 winning Invalid shares through the SecurityPool. Because of protocol holding fees, the refund is the current net collateral value, not necessarily her original gross ETH.

Liquidity providers hold Invalid shares separately in exactly the same way. Selling or transferring LP tokens never moves that insurance.