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Every half second, Likely runs a mini-auction. All bundles submitted during that window compete based on how much they’re willing to pay (tips) and when they arrived. The highest-value bundles execute, the rest wait for the next auction. This simple mechanism eliminates the speed advantage and creates fair competition.

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The 500ms Rhythm

Likely operates in a continuous cycle:
Each cycle:
  1. Window opens - traders submit bundles
  2. 500ms passes - bundles compete
  3. Window closes - top bundles execute
  4. Repeat - next auction begins immediately

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How Bundles Compete

During the auction window, you can: The strategy: Do you bribe to jump ahead, or keep your early timestamp? This creates interesting dynamics, especially for arbitrage opportunities where multiple traders compete.

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Priority Rules

Bundles execute in strict order:
  1. Highest tip goes first
  2. Oldest submission breaks ties (if tips equal)
  3. One bundle per user (your latest replaces earlier ones)
Example:

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What Happens at Auction Close

When the 500ms window ends: 1. Load traders (instant)
  • System loads all users with bundles
  • Fast access via cache
2. Execute by priority (deterministic)
  • Process bundles from highest tip to lowest
  • Each bundle succeeds or fails atomically
  • Skip “ghost” entries (from amended/bribed bundles)
3. Distribute tips
  • Successful bundles: Full tip → market makers who filled orders
  • Failed bundles: Small tip portion → protocol liquidity fund
  • Unselected bundles: No tip payment
4. Update markets
  • Generate orderbook snapshots
  • Broadcast new prices to all clients
  • Clear auction state
5. Start next auction
  • New window opens immediately
  • Cycle continues

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The Vickrey (Second-Price) Logic

Likely uses a Vickrey Auction model for the highest-priority bundle. This means the winner pays the second-highest tip declared in that batch rather than their own. Why this matters:
  • Incentive Compatibility: Traders are encouraged to bid their true valuation (truthful bidding).
  • No Overbidding: Prevents “gas-war” dynamics where users bluff with massive tips they can’t actually afford.
  • Marginal Cost: The top bundle pays the actual marginal cost of being first, not its maximum bid.
  • Fair Participation: Subsequent bundles pay their own declared tip to maintain a non-free, meaningful signal for the rest of the batch.

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The Lazy Removal Trick

When you amend or bribe your bundle, the system doesn’t remove your old entry from the queue (expensive). Instead:
  • New bundle added with updated tip/timestamp
  • Old bundle stays but becomes a “ghost”
  • During execution ghosts are skipped
This makes amending/bribing instant, even with thousands of competing bundles.

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Why 500ms?

Fast enough:
  • Max latency is predictable (500ms)
  • Acceptable for prediction markets
  • Real-time enough for most strategies
Slow enough:
  • Eliminates speed advantage
  • Everyone has equal opportunity
  • Can adjust strategy mid-auction (amend/bribe)
Just right:
  • Creates competitive dynamics
  • Enables atomic multi-market strategies
  • Fair for all participants

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Real-World Example

Scenario: Arbitrage opportunity appears
This competition is healthy - it ensures arbitrage opportunities go to those willing to pay the most, and those tips fund liquidity for everyone.

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Benefits

For traders:
  • Fair competition based on value, not speed
  • Predictable max latency (500ms)
  • Can adjust strategy during auction
For market makers:
  • Earn tips from successful fills
  • Can’t be picked off by faster traders
  • Privacy protection (bundles don’t expose identity)
For arbitrageurs:
  • Compete on value, not infrastructure
  • Atomic execution across markets
  • Risk-free with execution policies
For the platform:
  • Failed tips fund liquidity
  • Sustainable incentive structure
  • Scales to thousands of traders

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Next Steps