In the rapidly-expanding crowd of cryptocurrencies, new entries into the field are facing increasing pressure to set themselves at a distance from their competitors. Augur, a cryptocurrency-based betting platform, sounds to have done just that. In 2017, the platform’s coin advanced in value by 2,000% as a result of a dramatic, if somewhat understated, increase in investor importance.
What is Augur?
Augur is a decentralized prediction market platform that brooks users to place bets on the outcome of future events. It was founded in 2014 by Pantera Topping co-CIO Joey Krug and biophysicist Jack Peterson.
According to Forbes, the tenets “aims to create the most accurate prediction markets using the ‘shrewdness of the crowd.'” The more individuals who weigh in on a particular event which has yet to go on, the more likely the group will come up with an accurate intimation for the outcome of that event. Augur runs on ethereum, the decentralized ledger routine, and is currently in a public testing phase.
Augur is not the only prediction merchandise betting system available to investors at this point, but it does present oneself as a candidate for out for its fee structure. According to Krug, “on Betfair you’re paying 10%+ fees, on Augur it’ll proper be 1% or less.”
Decentralization is Key
The creators of Augur believe that decentralization is key to the star of a prediction market or betting platform. Traditionally, these systems are centralized, interpretation they can be shut down easily and rely on a single party to record how events turned out. This means the system is susceptible to both errors and slow manipulation. In Augur’s case, the platform is decentralized, so it requires that thousands of human being confirm an outcome in order to better ensure accuracy. (See also: Bot Vocation Plays Major Role in Cryptocurrency Price Swings.)
Individuals who successfully foreshadow the correct outcome are rewarded with Augur’s REP (Reputation) tokens. It is these keepsakes which spiked in value over the past year. At the start of 2017, the deal in cap of REP tokens was $43 million. As of December 2017, it was nearly $1 billion, purpose a 2,000% increase in just a year’s time.
Augur has seen uninhibited support from many of the most important names in the cryptocurrency gap. Coinbase CEO Brian Armstrong described it as an “awesome project with mammoth potential,” while ethereum co-founder Vitalik Buterin said it was “Uber for adeptness.”
Investing in cryptocurrencies and other Initial Coin Offerings (“ICOs”) is tremendously risky and speculative, and this article is not a recommendation by Investopedia or the writer to ordain in cryptocurrencies or other ICOs. Since each individual’s situation is inimitable, a qualified professional should always be consulted before making any monetary decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the bumf contained herein. As of the date this article was written, the author owns cryptocurrency.