7.3 State Machines

Market Lifecycle

┌─────────────────────────────────────────────────┐
         Phased Dynamic LMSR State Machine       
└─────────────────────────────────────────────────┘

CREATED
   │
   ├─> Initial state after create_market()
   ├─> Status: BOUNDING
   ├─> target_b set (e.g., 1000 USDC)
   ├─> virtual_b = target_b (not dynamic yet)
   ├─> real_pool = $0
   ├─> Outcome tokens minted
   │
   ▼
BOUNDING Phase
   │
   ├─> Only BUY orders allowed
   ├─> Pool accumulates: real_pool += buy_amount
   ├─> Track trader deposits (for refunds)
   ├─> virtual_b = target_b (fixed)
   │
   ├─> Transition: real_pool >= target_b
   │    └─> Status: ACTIVE, virtual_b = real_pool (becomes dynamic)
   │
   └─> Timeout: end_time && status == BOUNDING
        └─> Status: REFUNDED (full refund to all traders)
   │
   ▼
ACTIVE Phase (if transitioned)
   │
   ├─> Both BUY and SELL orders allowed
   ├─> CRITICAL: virtual_b = real_pool (always, after each trade)
   ├─> Trading enabled (buy/sell outcome shares)
   ├─> Fees distributed to 4 vaults
   ├─> Volume accumulates
   │
   └─> Timeout: end_time reached
        └─> Status: COMPLETED
   │
   ▼
COMPLETED Phase
   │
   ├─> Trading disabled
   ├─> Awaiting oracle resolution
   │
   ▼
RESOLVING (oracles committing/revealing)
   │
   ├─> Commit period: 24-48 hours
   ├─> Reveal period: 24-48 hours
   │
   ▼
DISPUTED (optional)
   │
   ├─> User submitted dispute + stake
   ├─> Extended voting period
   ├─> Community resolution
   │
   ▼
RESOLVED
   │
   ├─> Winning outcome determined
   ├─> Winners can claim (proportional to pool)
   ├─> Losers receive nothing
   ├─> Zero-sum settlement (winners from losers)
   │
   ▼
CLOSED
   │
   └─> All claims processed
       └─> Market archived

REFUNDED (from BOUNDING timeout)
   │
   ├─> All traders refunded their deposits
   ├─> No winners/losers
   └─> Clean closure

Platform Lifecycle

┌─────────────────────────────────────────────────┐
              Platform State Machine              
└─────────────────────────────────────────────────┘

REGISTRATION
   │
   ├─> Stake PATH tokens
   ├─> Submit platform metadata
   │
   ▼
PENDING (7-day review)
   │
   ├─> Stakers can veto
   ├─> Timer countdown
   │
   ├──> VETOED (if community rejects)
   │    └─> Stake returned (minus penalty)
   │
   ▼
APPROVED
   │
   ├─> Can create markets
   ├─> Earns 0.1% platform fees
   ├─> Stake remains locked
   │
   ├──> SUSPENDED (if malicious behavior)
   │    └─> Cannot create new markets
   │
   ▼
UNREGISTERED (voluntary exit)
   │
   └─> Stake returned after cooldown
       └─> Existing markets continue earning fees