# Seed Dodgerswin USD Insurance Fund

**URL:** <https://dydx.forum/t/seed-dodgerswin-usd-insurance-fund/4631>\
**Category:** Proposals\
**Created:** [October 24, 2025, 3:19pm UTC](https://dydx.forum/t/seed-dodgerswin-usd-insurance-fund/4631 "2025-10-24T15:19:48Z")\
**Posts on this page:** 1\
**Page:** 1

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**Author:** ![Nemus\_Stakecito](https://dub1.discourse-cdn.com/flex013/user_avatar/dydx.forum/nemus_stakecito/32/2799_2.png) [@Nemus\_Stakecito](https://dydx.forum/u/Nemus_Stakecito)\
**Post date:** [October 24, 2025, 3:19pm UTC](https://dydx.forum/t/seed-dodgerswin-usd-insurance-fund/4631/1 "2025-10-24T15:19:48Z")

</div>

**Simple Summary**  
The [DODGERSWIN-USD market](https://www.dydx.xyz/blog/the-2025-world-series-perp-prediction-market) was recently launched as an event-based prediction market on dYdX.

We propose allocating 100,000 USDC from the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) to temporarily support the isolated [insurance fund](https://www.mintscan.io/dydx/address/dydx1lm5d367cvyjs59z4y0zhux6m9ta8tjqyy4hnhy) of the DODGERSWIN-USD market. The goal is to protect participants from potential auto-deleveraging events when the market unwinds at the end of the series.

By pre-funding the insurance pool, the dYdX community can reduce the risk of losses for solvent traders and uphold the integrity and reliability of trading on dYdX Chain.

**Abstract**

The [DODGERSWIN-USD market](https://www.dydx.xyz/blog/the-2025-world-series-perp-prediction-market) was recently launched as an event-based prediction market on dYdX. Prediction markets are particularly susceptible to auto-deleveraging because of their binary settlement (to $0 or $1) and limited insurance fund capitalization.

To mitigate this risk, we propose allocating 100,000 USDC from the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) to the DODGERSWIN-USD market’s [insurance fund](https://www.mintscan.io/dydx/address/dydx1lm5d367cvyjs59z4y0zhux6m9ta8tjqyy4hnhy). This measure ensures the DODGERSWIN-USD market’s [insurance fund](https://www.mintscan.io/dydx/address/dydx1lm5d367cvyjs59z4y0zhux6m9ta8tjqyy4hnhy) is well-capitalized to absorb potential losses without invoking auto-deleveraging for traders, thereby maintaining a smooth and fair settlement process for all participants.

**Motivation & Rationale**  
Following the community’s experience with the TRUMPWIN-USD prediction market, the DODGERSWIN-USD listing provides another opportunity to improve how event-based perpetuals handle auto-deleveraging.

Insurance funds on dYdX are capitalized through liquidation fees, meaning newly listed isolated markets typically start with limited reserves. Under normal conditions, the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) (for cross-margined markets) or each isolated market’s own fund covers any liquidation shortfalls.

However, in prediction markets with binary outcomes, losses can exceed the capacity of the isolated market insurance fund at settlement. When this happens, auto-deleveraging is triggered to preserve protocol solvency by partially reducing profitable positions.

Pre-funding the DODGERSWIN-USD market’s [insurance fund](https://www.mintscan.io/dydx/address/dydx1lm5d367cvyjs59z4y0zhux6m9ta8tjqyy4hnhy) offers a practical way to absorb potential liquidation losses and lower the probability of auto-deleveraging for traders. Any surplus after settlement can be returned to the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) with a governance proposal.

**Specification**

We propose transferring 100,000 USDC from the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) to DODGERWIN-USD’s [insurance fund](https://www.mintscan.io/dydx/address/dydx1lm5d367cvyjs59z4y0zhux6m9ta8tjqyy4hnhy). Once the market is settled and wound down, any unused funds can be transferred back to the [Insurance Fund](https://www.mintscan.io/dydx/address/dydx1c7ptc87hkd54e3r7zjy92q29xkq7t79w64slrq) with a governance proposal.

**Next Steps**

We invite the community to provide feedback on this proposal. Considering the schedule for the MLB World Series’ matches, the result of this market might be available by Wednesday, October 29, 2025, we are planning to submit an expedited proposal on Monday, October 27, 2025.