Glossary

Key terms and concepts used throughout the HALO documentation.

A

AMM (Automated Market Maker)

An algorithmic system that provides liquidity by placing buy and sell orders automatically. HALO's AMM uses AI to optimize spreads and detect opportunities.

Arbitrage

The practice of exploiting price differences between markets. In prediction markets, this occurs when P_UP + P_DOWN < 1, allowing guaranteed profit.

B

Binary Market

A prediction market with exactly two outcomes (e.g., "Yes" or "No"). One outcome will pay out $1, the other $0.

C

Compound Interest

Reinvesting profits to generate additional returns. HALO automatically compounds 80% of gross profits back into the vault (after 20% performance fee).

Confidence Score

A metric (0-100%) indicating the model's certainty in a prediction. Higher confidence trades are prioritized.

D

Deposit Fee

No fee charged when depositing funds into the vault. Deposits are free.

E

Ensemble Model

A machine learning approach that combines multiple models (XGBoost, LSTM, PPO, LLM) for improved accuracy and robustness. Analyzes 45 features to discover fair value.

F

Fair Value

The true probability of an outcome as predicted by our AI models, independent of current market prices.

G

Guaranteed Profit

Profit that is mathematically certain regardless of market outcome. Achieved when P_UP + P_DOWN < 1.

H

HALO

HALO AI - the protocol name. Also refers to the governance and utility token ($HALO), separate from vHALO vault shares.

I

InfoBlock

A styled content block used in documentation to highlight important information.

L

LSTM (Long Short-Term Memory)

A type of neural network that analyzes sequential data and temporal patterns in market prices.

M

Market Making

Providing liquidity by simultaneously placing buy and sell orders, capturing the bid-ask spread.

Mispricing

When market prices diverge from true probability. HALO's AI detects mispricing >5% for trading opportunities.

O

Opinion

One of the primary prediction markets where HALO's AI bot provides liquidity and captures spreads.

P

P_UP / P_DOWN

The probability (price) of the "Yes" and "No" outcomes in a binary market. In efficient markets, P_UP + P_DOWN = 1.

Performance Fee

A fee charged on gross profits from spread capture. HALO charges 20% performance fee, allocated as: 50% to staking rewards, 25% to buyback & burn, 25% to protocol treasury.

Polymarket

One of the primary prediction markets where HALO's AI bot provides liquidity and captures spreads.

PPO (Proximal Policy Optimization)

A reinforcement learning algorithm used in HALO's ensemble model for optimal trading policy learning.

R

Reserve Buffer

Capital held in reserve (typically 30%) to ensure liquidity for withdrawals and new opportunities.

S

Sharpe Ratio

A risk-adjusted return metric. Higher values indicate better risk-adjusted performance.

Stop Loss

An automatic exit trigger when a position reaches a predefined loss threshold (typically 10%).

V

vHALO

Vault HALO shares - tokens representing your proportional ownership in the HALO vault liquidity pool. As the vault generates profits, vHALO becomes more valuable. Distinct from HALO governance token.

Volatility

A measure of price fluctuations. Higher volatility markets carry more risk but may offer higher returns.

W

Withdrawal Fee

No fee charged when withdrawing funds. However, withdrawals require a 1-day lock period to allow the AI bot to unwind active trading positions before returning funds to the vault.

Withdrawal Lock Period

A 1-day (24 hour) period required after requesting withdrawal. During this time, the AI bot unwinds positions on Opinion and Polymarket and returns funds to the vault pool. This ensures safe withdrawal without disrupting active trades.

X

XGBoost

A gradient boosting machine learning algorithm used in HALO's ensemble model to analyze technical indicators and predict market outcomes.

Y

Yield

Returns generated by the vault through spread capture and arbitrage. 80% of gross profits compound in the vault, increasing vHALO share value. The remaining 20% is charged as performance fee.

Additional Terms

Avellaneda-Stoikov Model

A mathematical model used by HALO for real-time spread adjustment based on volatility, liquidity, and market conditions.

Kelly Criterion

An optimal position sizing formula used by HALO to determine how much capital to allocate to each trading opportunity based on edge and bankroll.

LLM (Large Language Model)

A component of HALO's ensemble model that analyzes sentiment signals and market context.

Seedify

The launchpad where HALO token will have its Token Generation Event (TGE) on January 29, 2026.