Markets

Terp Network provides the primitives for building verifiable markets — economic coordination mechanisms where rules are enforced by code, not counterparties.

Open Markets

An open market is one where any participant can join, submit orders, and settle without permission. On Terp Network, open markets are implemented using:

• Smart contracts — any contract can define an exchange mechanism (order book, AMM, batch auction)
• IBC — assets from any IBC-connected chain can participate
• Permissionless deployment — no approval needed to launch a market contract

Open markets on Terp Network inherit the network's properties:

• Censorship resistance — no entity can block a participant
• Transparency — all trades are on-chain and auditable
• Finality — settled trades cannot be reversed

Closed Markets

A closed market restricts participation to verified members. Terp Network supports closed markets through:

• Token-gating — only holders of a specific NFT or token can interact
• DAO-controlled markets — membership is governed by vote
• Selective disclosure contracts — participants prove attributes without revealing identity

Closed markets are useful for:

• Regulated environments (KYC-compliant pools)
• Private trading groups
• Membership-based economies

Verifiable Markets

A verifiable market is one where all operations can be independently audited. Terp Network ensures verifiability through:

• On-chain settlement — every trade is recorded in a block
• Merkle proofs — participants can prove their trade was included without revealing their counterparty
• Open source contracts — market logic is publicly auditable
• Zero-knowledge proofs — future capability for private but verifiable trades

Market architecture diagram scaffold — a visual showing how smart contracts, IBC, token-gating, and settlement connect in a Terp Network market. Categories: open, closed, verifiable.

Market Examples on Terp Network

Market flow scaffold — a sequence diagram illustrating a complete market lifecycle: participant creates order → contract validates → counterparty fills → settlement occurs → state update confirmed.

Design Principles

When building markets on Terp Network:

1. Start with the settlement mechanism — how do tokens change hands?
2. Define participation rules — open, gated, or hybrid?
3. Specify the resolution — how does the market settle disputes?
4. Test with localnet — use O-Line or terpd testnet before mainnet

See the CosmWasm guides for contract development patterns.