Hybrid Dutch auction (Insider)

Also called the Insider auction based on the Dutch auction. It consists of three stages, each of which is a separate auction type itself: the Dutch auction, Sealed Bid and Best Price auctions.

The Dutch Part

The essential rules of this part are the following:

• The gradual fall of the lot’s price by a certain percentage of its initial price within a fixed time span until one of the participants decides to take the lot at its current price, or the price value reaches its lowest predetermined amount, and the auction finishes;
• Reduction of the lot price by 1% is called the bid step;
• The price reduction rate and the lowest value amount are determined by the auction organizer;
• The first participant to agree to take the lot becomes the “dutch winner”;
• New participants may join the auction any time until the Dutch part finishes.

Final lot price becomes the initial lot price for the next stage. The winner of this stage does not take part in the Sealed Bid part.

After the Dutch part, there is a 10-minute pause.

Sealed Bid Part

The essential rules of this part are the following:

• The bids are made and submitted secretly by each participant within 10 minutes;
• The “Dutch winner” does not take part in the Sealed Bid part.
• Nobody is able to see each other’s bid values during the round;
• When the round is over, the highest bid is disclosed;

This is the second stage of the Hybrid Dutch auction. The bids made by the participants here should be higher than the initial value (the price fixed at the first stage).

After the Sealed Bid part, there is a 20-second pause.

Best Bid Part

This is the third stage of the Hybrid Dutch auction which is the chance now for the “dutch winner” to compete with the second stage winner and offer an even higher payment. It lasts for 5 minutes and its winner becomes the winner of the whole Hybrid Dutch auction.