Augur REP

$6.84
Market Cap $ 75.200 MM (#54)
24h Volume $ 1.320 MM
Chg. 24h: 16.81%
Algo. score 4.3/5  (#14)
Show Quick Stats

Augur project purpose and description

Augur clarity of purpose

Augur purpose and aspects

Efficient Forecasting, Speculate on everything, Wisdown of the crowd, Decentralized prediction platform

Augur additional differentiation against competition

--

Augur categories

Prediction market

What is Augur?

Augur is an Ethereum based, peer2peer, decentralized oracle and market prediction platform.

It allows users in its platform to craft markets for questions they might have on different issues and make profits from trading that allows people to buy positives or negatives for future events.

The Augur system allows users to trade in the prediction markets at a very low cost. The main expense involved is that participants compensate the creator and those who make the correct prediction.

A small amount is also used to reward those who provide the correct information about the markets. The platform was founded by Jack Perrson and Joey Krug, is written in JavaScript and Solidity, and runs as a decentralized app (DApp).

By employing smart contracts in the Ethereum network, the markets are automated so that no one has control over how it resolves questions or spends funds. This implies that no one, not even the market creator can approve or reject a trade, modify, undo trade, or even cancel orders. When a position is taken, it must hold until the end.

What is the problem that Augur Solves?

In the past, prediction markets were highly centralized. The markets had to rely on trustworthy entities to maintain public ledgers. This opened them to huge manipulation.

In many cases, the betting organizations easily manipulate the outcomes and at times cancel orders to ensure that the creators pocket hefty profits. Most of them can easily turn into theft and serious corruption rigs with little motivation to users.

The centralized market prediction system implies that the traditional market prediction systems could not be trusted. Besides, they also limited the markets such that you can get a betting platform that only limits operations to Soccer, Athletics, or even racing. Others even limit participation to specific regions.

The design of most traditional prediction markets makes them highly inflexible. Their design locks out any suggestion or even introduction of new markets which limits those who can get involved. Most prediction markets will not allow you to venture into unlisted markets.

For example, it is impossible to predict a political event or an entertainment competition on a common sportsbook. These are the issues that Augur targets to address.

How does Augur solve the problem?

The main method used to address the problems of the prediction markets platforms is decentralization. Augur created a platform that allows every person to create markets around major questions and make huge profits from them. This is achieved through two main things; creating markets and trading event shares. But in this case, the list has been extended to include the native token, Reputation (abbrev REP) that is used for payments in the Augur system.

Creating markets

In order to create a market, a user is required to put forward a small amount in Reputation (REP). Once you create a market, you are required to set the fees for the maker and taker. The fee is the cost of purchasing and selling shares on Augur. The taker fee at the platform is required to be within the range of 1.0% and 12.5%. Then, the maker fee cannot surpass the taker fee by 50%. When the market closes, this is the fee you will receive as the market creator.

Augur plans to set a creator fee that will help to address the ups and downs of calculating the maker/taker fees. The creator fee will be taken from rewards of traders who win positions and channeled to the market creator.

To attract more people, the market creator should try to keep the fee low. However, the fee should be high enough to meet the original cost used to create the market. This implies that you need to have the bigger picture of the market and get the expectations right. This is why market creators are advised to focus on areas that evoke a lot of interest.

  • Trading event shares

In addition to creating markets, users in the Augur system are allowed to buy and trade shares representing odds that the picked event will have a specific outcome. For example, a common question that a market creator would have posted towards the close of 2017 about Bitcoin was, “will Bitcoin price hit $20k by the close of 2017?”

Because of the huge interest in Bitcoin by 2017, this market would have been of great interest to you. If you are fairly confident it will hit $20k mark, you can opt to buy about 100 shares. The higher the price of the shares you go for, the stronger is your belief that an event will happen. Note that this is an example of a binary prediction (yes/no) model, but other prediction models can still be used.

As a trader, you can make money in two ways. One, you can take advantage of price fluctuations where shares are bought at a lower fee and then sold at a higher rate when the sentiments change. It is important to look for real-world catalysts when planning to cash on price fluctuations.

Two, you can make cash if you made the right prediction and still hold shares by the time the market closes. In such a case the payout will look something like this.

Payout=No of Shares *Price/No of Ticks. (The ticks are the number of possible price points between the lowest and highest price in the markets)

It is also important to appreciate that you are required to pay the settlement fee for every winning. This includes curator fee and reporting fee for the Decentralized Oracle System. The higher your earning, the higher the fee.

  • The Augur Reputation Tokens (REP)

The Augur Decentralized Oracle System is powered by the REP token. Users are required to stake REP in order to report outcomes of events for various markets. When the market closes, you are required to report the outcome of the event and put some REP to back the claim. If the event did not happen, it becomes invalid (you cannot report on it).

After the market closes, a window of 27 days is available for submission of reports. If the report is the same as the majority of other reporters, the REP you had put forward will be returned plus a reporting fee. Here is the fee for reporting calculation formula.

Reporting fee=the present reporting fee*(open interest on Augur*5/REP Market Cap).

Note that new reporting fee is calculated every thirty days. If you staked more when submitting the report, the reporting fee will be greater.

Other important components in the Augur Decentralized Oracle include;

  • Appeals bond: This is the bond posted by anyone on the Augur system to have an Open Market Re-adjudicated.
  • Blockchain fork: When the number of transactions divide into two separate timelines because of reconcilable disagreements.
  • Early resolution bond: This is a bond paid by a person in the Augur system to request a specific market to be resolved prior to its expiry time.
  • Fork bond: This is a bond posted by a person who wants the reputation history fork in order to contest the consensus that was reached at the appealed markers re-adjudication.

What makes Augur better than it’s competitors?

The main focus of the Augur development team was to disrupt the prediction market by empowering users to get actively involved.

By changing how the markets are identified and prediction run in a decentralized manner, Augur set itself against the top prediction giants such as casinos.

Here are the main things that make Augur better than its competitors.

  • The transaction fee at Augur is very small

Augur is a platform that allows users to create the markets and incentivize more people to get involved directly. This implies that there are no third parties that make the conventional prediction markets expensive. Because payment is paid on a peer2peer basis, there is no middleman or company seeking to profit from predictions. Since payment uses Ethereum based REP, the payments are also not effected via centralized organizations such as banks or credit cards that further raise associated costs in conventional prediction marketing.

  • There is no limit on the markets that can be created

In the Augur system, there is no limit on the markets that can be created. This implies that there are limitless prediction opportunities for prediction enthusiasts. You can opt to create a market in sports, politics, or any other area. This makes it a better option compared to the conventional prediction markets that only focus on major events such as major sports events in major leagues or racing events.

  1. Anyone can create a market on the Augur system

While the traditional prediction markets only allowed their administrators to create the markets, Augur empowers anyone on its system to create markets. This means that you do not have to look at standard betting events and wonder how they were done. Simply join Augur to get an equal opportunity to also create such markets and generate huge returns from it.

  • Augur system implements automated payments

In standard market prediction systems, payments after making a correct prediction are never direct. In most of the cases, a raft of conditions has to be met before a win is released to your wallet. For example, you might be required to roll the win on a number of times before withdrawals can be effected. However, Augur system is run via smart contracts where payment is automatically effected once the correct prediction is confirmed.

  1. The Augur system is open to all

A closer look at the traditional prediction market indicates it is highly selective. Most of them are run under strict local and international laws which limits those who can be involved. In some cases, countries have very strict laws that prevent their citizens or specific groups of people from getting involved. However, Augur is open to all. No matter where you are located, the platform is a decentralized system where anybody can get involved without worrying about getting discovered by third parties.

  • Augur ecosystem has its own cryptocurrency

Most conventional prediction markets lack their own currencies. This implies that they have to rely on the fiat currencies and payment services such as credit cards that easily push the cost up. However, Augur is a step ahead of them because it has own cryptocurrency. This means that everything is housed in the same ecosystem. From market creation to information gathering, prediction by users and payments are all done in the same system. The only point where Augur relies on another party is basing its native tokens, REP, that are based on the Ethereum blockchain. But even this approach helps to amplify the integrity of the tokens because Ethereum is a highly effective and stable platform. This has helped to grow the popularity of Augur and give its value an upward trending approach.

What makes Augur better than it’s competitors?

Augur can be categorized as the new decentralized prediction market that will help to redefine the industry. While the prediction markets is a very huge niche, it has been chocking with the players trying to seek alternatives.

Now, a new option that is Augur has demonstrated that it is possible to free the industry from shackles of centralized monolithic operators. Whether you want to create a market about a local event or a global one, Augur is a reliable platform whose value is expected to grow rapidly because of its structure, rich target, and fast emerging demand.

What’s Augur’s vision on Security?

The main vision on security for Augur is providing users with a completely decentralized and secure market prediction platform. Starting from the beginning, the Augur founders and its development team have been seeking to progressively improve the core code and assure users of optimal security for their assets, information, and predictions. Other methods used to help achieve this goal include;

  • Advanced encryption that helps protect user information at all levels.
  • The Augur native token, REP is based on a highly reputable Ethereum blockchain.
  • The tokens are distributed as rewards to those who make the right predictions or provide correct market info to the Augur system. This helps to prevent 51% attack.

Examples of Augur’s use cases / applications.

Political forecasting: Augur allows users to turn the political knowledge into strong predictive power by trading outcomes. This can be anything from an upcoming election outcome, policy decision, bills on the pipeline, and other political events.

  • Event hedging: The Augur prediction market allows users to hedge against catastrophic events such as natural disasters, market crashes, and even geo-political. When summer approaches, think of predicting the occurrence of a tornado and trade on the outcomes.
  • The weather prediction: Augur allows you to use the power of the crowd to create a highly accurate weather prediction such as daily averages temperatures, heat waves, and others.
  • Company forecasting: For people in businesses, Augur can be a great guide for decision making. The company management can use Augur to predict projection completion timelines, sales, and project completion timelines.
  • In the conventional market such as sports prediction: If you are into sports betting such as soccer and athletics, you can easily cash on creating own markets. You do not have to stick to the old betting model, create your own market and make a huge profit from it.

References

https://coincheckup.com/coins/Augur

http://veritas.veritaseum.com/

https://veritas.veritaseum.com/ve-blog

http://bravenewcoin.com/assets/Whitepapers/Augur-A-Decentralized-Open-Source-Platform-for-Prediction-Markets.pdf

 

Enjoying our data? We have spent over 4000 hours on Platform Development and Coin Research. Donations are welcome!
Trading and investing in digital assets is highly speculative and comes with many risks. The analysis / stats on CoinCheckup.com are for informational purposes and should not be considered investment advice. Statements and financial information on CoinCheckup.com should not be construed as an endorsement or recommendation to buy, sell or hold. Please do your own research on all of your investments carefully. Scores are based on common sense Formulas that we personally use to analyse crypto coins & tokens. We'll open source these formulas soon. Past performance is not necessarily indicative of future results. Read the full disclaimer here.
Dark Theme   Light Theme