Overlay Protocol is a decentralized platform on Ethereum that allows users to build positions on various markets or data streams without relying on traditional counterparties. It offers markets based on price data feeds and non-manipulable & non-predictable data feeds, and users build positions against the protocol itself or every other OVL holder simultaneously, eliminating the need for liquidity providers or market makers. Trading is done with OVL tokens, which serve as collateral and are minted as profit or burned as losses in positions.