Settlement is the process by which an event contract is resolved against its stated outcome source and paid out to holders.
Last reviewed 9 October 2025 · Educational, not advice
Settlement is what happens when an event contract reaches its resolution. The market stops trading, the outcome is determined against the source named in the contract rules, and each position is paid accordingly. On a typical yes or no event contract the winning side settles at one hundred cents and the losing side settles at zero, so the money already posted by both sides simply moves to whoever held the correct contract.
The detail that matters most is the resolution source. Every well written contract names exactly how the outcome will be decided and which source will be consulted, whether that is an official result, a government release, a recognised data provider, or a defined rule for edge cases. Reading that source language before you trade tells you what you are actually being paid on, which is not always the headline question as you first read it.
Settlement is distinct from the resolution date, which is when the question is scheduled to be answered, and from the moment funds become available to withdraw, which can come later. After a market resolves, a platform applies the result, credits balances, and then releases funds under its own processing rules. A contract can be decided well before the cash is usable.
Markets can also settle early or be voided. If an outcome becomes certain before the scheduled date, some venues settle ahead of time. If a contract cannot be resolved fairly, for example because an event is cancelled or a source fails, the rules may call for the market to be voided and stakes returned. The contract rules, not intuition, govern these cases.
For a trader, settlement is the point where an implied probability becomes a binary fact. A contract that traded at sixty cents did not promise sixty cents back. It paid one hundred or zero depending on the outcome. Understanding how, when, and against what a market settles is part of knowing the real risk you carry into the close.
Suppose a contract asks whether a named index closes above a level on a given date, and it settles against the official closing value published by the listing venue. You hold the yes at 70 cents. At the close the published value is above the level, so the yes settles at 100 cents and the no at zero. Your gain before fees is the 30 cent difference, paid once the platform applies the result.
Illustrative only. Numbers are examples, not a quote or a prediction, and exclude fees.
Settlement turns a price into a yes or no result, and a contract that looked likely can still settle at zero. Read the resolution source and rules before you trade so you know exactly what you are paid on. Stake only what you can afford to lose, never to chase a loss, and never on borrowed money. If it stops feeling like a free choice, step back. In the United States you can call or text the helpline on 1-800-GAMBLER or visit ncpgambling.org.
Settlement is the process of resolving the contract against its stated outcome source and paying holders. On a yes or no contract the correct side is usually paid one hundred cents and the other side zero.
No. The resolution date is when the question is scheduled to be answered. Settlement is the act of applying that result and crediting accounts, and the funds may take longer to become available to withdraw.
The contract rules govern. Many venues void a market and return stakes if the event is cancelled or the named source fails, rather than guessing an outcome. Always read the rules before trading.
In the contract rules on the platform, which name the resolution source and the exact condition. Confirm them yourself before trading, as wording can differ from the headline question.
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