If you haven't yet understood why YES and NO in prediction markets must sum to 1, it's recommended to first grasp the fundamental concepts introduced earlier.

Today, we need to address a core question: when no one has participated in a trading pair yet, where does the initial market price come from? In other words, is it possible to acquire positions at a low price in the very early stages?

The answer involves two operational logics—splitting(Split) and merging(Merge). Let's start with splitting.

**Generating Trading Credentials with $1**

On the order placement page, you'll find a feature that is easy to overlook. After entering the quantity and clicking execute, your invested $1 will be split into two credentials: one representing the event happening(YES), and the other representing the event not happening(NO), each worth $0.5.

At this moment, the equation YES + NO = 1 holds true. From a practical perspective, you are effectively able to decompose dollars into two corresponding positions in any market at any time.

This is the key to understanding the entire mechanism. Most traders are unaware that the initial liquidity of a new market is gradually accumulated through this splitting method. Early participants inject funds by splitting, creating trading credentials for both YES and NO directions, enabling subsequent trades to develop on this foundation.

From another perspective, this mechanism makes market participants themselves providers of liquidity. You do not rely on platform-driven pricing; instead, by performing splitting operations, you create the most basic trading objects. This also explains why prediction markets can self-balance—because anyone can correct price deviations through splitting.