Prediction markets, the current buzz around them points out that they could just be the ones to change everything as it is. They provide opportunities to just anyone to earn money by predicting the likelihood of future events. These open and permissionless platforms are the current highlights in the crypto world. Do you know how these prediction markets work? Simply put, these platforms allow you to create any market about a future event and once the event is created you can buy shares for the possible outcomes and earn the rewards for the correct prediction after time passes. If you are wondering why we are talking about prediction markets here, it is because Augur(REP) is a decentralized Prediction market. And here in this article, we are going to explore everything there is to know about Augur(REP) and how it works. Let us go ahead and find out more about Augur.
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What is Augur(REP)?
Augur, like we already mentioned above is a decentralised prediction market protocol. It currently utilizes the Ethereum blockchain network, although there is word going around that it is planning to shift it to another network. Like all the other prediction markets out there even here in Augur(REP), people can bet on the possible outcomes of future events and be rewarded with monetary assets upon a successful prediction of the outcome. With the wisdom of the crowd, that is the predictions made on the platform, Augur provides more accurate predictions of the events than most other platforms.
With Augur, you can have the benefits of blockchain technology brought into the prediction community. As a result, you can enjoy, lesser fees, great accessibility and more importantly higher accuracy than other such platforms.
Who are the Founders of Augur(REP)?
Now that you know what Augur provides us with, you might be curious to know about the minds behind this wonderful project. Augur was created now is also being supported by the Forecast Foundation. It was founded in the year 2014 by Jack Peterson, Joey Crug and Jeremy Gardner.
The founders’ motivation behind the creation of Augur is to provide people with a non-biased marketplace where they could speculate and monitor the outcome with a trusted and impartial judge. Hence, a decentralized marketing platform like Augur. The platform was built to eliminate the risks associated with the centralised prediction markets like theft, self-interested judgements, corruption etc.
What makes Augur(REP) unique?
We already know that Augur is a peer to peer prediction platform which is built on the Ethereum blockchain. But what makes Augur unique is its decentralized nature and open source contracts. Augur’s governance model allows literally anyone to participate in fair speculation. Not only that, in accordance with the thought that motivated the creation of Augur, the founders of the platform doesn’t take part in the governance of the platform but maintain its open-source code. That makes Augur unique as there is no centralisation in the platform and the users can speculate the predictions without bias.
How many Augur tokens(REP) are there?
REP otherwise called Reputation is the official token of the Augur platform. They were initially released in the year 2015 as the governance tokens of the platform. There are currently 11,000,000 REP tokens in circulation making the circulating supply of the token 11 million REP. The maximum supply of the REP tokens is currently not available. 80 per cent of the REP were released in its Initial Coin Offerings to raise funds and the remaining 20 per cent of the tokens were allotted to the founders and advisors of Forecast Foundation.
How does Augur(REP) work?
Since it is a prediction market, its basic purpose includes making predictions, placing bets and reaping the benefits of a successful prediction.
You can classify the functioning of Augur primarily into two actions. One is creating markets and the other is trading event shares.
As to create a market in Augur, you need to spend a small amount of ETH. That market could be about any possible future event. The question can be anything. You can create a market about the rise or drop in the price of Bitcoin or if it reaches a certain price in a certain period or just anything. Originally the creators would set the maker and taker fees which refers to the costs to sell and buy the shares on the books. But now, there are no maker and taker fees but the creator fees. Creator fees would be chosen by the creators which is the percentage of winnings that goes to the creator. The percentage could be anywhere from zero to fifty per cent. But if you want more people to bid on your market, it is suggested to keep the percentage low. Also while creating the market one thing you should keep in mind is that the lesser the probability of the event happening more would you earn.
The second action is trading event shares. Other than creating markets you would buy and trade the shares pertaining to the odds of the market event happening. If you believe that the odds are higher that the event would occur, you would buy shares with more price. The price of each share could be anywhere between 0 to one ETH. You could buy or sell the shares based on the price fluctuations. For example, you could buy the shares for less price and can sell them at a higher price when the price goes up since the demand for the share increases. You can also hold on to your shares and get the payouts at the end if your prediction is correct.
Wrapping Up
When it comes down to the prediction markets, you can say that Augur is one of a kind. Here in Augur, everything is a lot better when compared to other platforms that claim to offer similar services. You can benefit from the fewer fees, unbiased speculation and better accuracy. Since it is decentralized you don’t have to worry about the partial governance of biased outcomes. Also, it provides real-time data which is more accurate than most leading experts out there. Great isn’t it? Hope you found this article helpful. For more such content visit Postling.
