> For the complete documentation index, see [llms.txt](https://docs.runealpha.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.runealpha.xyz/en/ordinals-chef/auction.md).
# Dutch Auction
## What is Dutch Auction ?
Dutch auctions start with a high price for something and then the price goes down until someone decides to buy it. The person selling the item begins with a high price and keeps lowering it until someone agrees to buy. This kind of auction is often used for items that need to be sold quickly like flowers, fish, and vegetables. It's also used for selling a lot of something at once, like stocks and bonds.
## How Dutch Auctions work ?
* Starting Price: The auctioneer starts with a high price and then gradually lowers it until all items have been secured.
* The Bidding Process: As soon as the auctioneer sets the initial price. The price of the asset continues to fall until the winning bid is made
* Clearing Price: The auction will clear when current price hits a reserve price or current demand meets or exceeds supply.
* Timing: Timing is everything in Dutch Auction. The price will change interval, and buyers need to act fast if they want to purchase the item. Every time the price drops, it reduces or **eliminates** the chance to buy the item because with the amount of money from someone who bid higher before, they could buy more items at the new lower price.
After figuring out the **Clearing Price**, all bids that meet or exceed this price get accepted. Every winning bid pays the **same price**. However, who gets their bid accepted first depends on the bid price and when they made their bid. Bids with higher prices get priority, but if several bids are the same price, the order is based on who bid first.
If your bid was higher than the final **Clearing Price**, you'll get items based on how much you bid divided by the clearing price for each item.\
The **Clearing Price** can be the same as or less than a participant's bid, but it can't be higher.
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