Augur is finally live.
The decentralized platform for betting on real-world predictions was one of the first applications built on top of the ethereum blockchain, and its creators sold “reputation” (REP) tokens for over $5 million in 2015 – a time when few were talking about “ICOs” or “utility coins.” A public beta version of the platform came out the following year, and its team published a revised version of its white paper in January.
Now, the Forecast Foundation, the not-for-profit behind Augur’s development, has announced the launch of the long-awaited platform, which was accompanied by the release of the final version of the Augur application as open-source software.
Augur allows participants to bet on anything.
As long as the outcome can be verified in the real world, users can create a prediction market for anything from ether’s price, an election in Brazil or the outcome of Iceland v. Argentina in the World Cup.
What distinguishes Augur from a traditional betting market is that no single party sits in the middle, meaning that users are likely to pay lower prices.
Removing the centralized intermediary from a betting market presents a problem, however: how to bring dispersed, financially interested parties into agreement about the actual outcome of the predicted event?
In Augur’s system, the creator of a prediction market designates a “reporter” to vet the outcome. This designated entity puts down a deposit of REP tokens, which they lose if they incorrectly report the outcome and other REP holders challenge them. The reporter is compensated through fees.
Day-to-day betting is not done in REP, but in ether, the native token of the ethereum blockchain (though, eventually, the plan is to support other ethereum-based tokens). Users can buy and sell shares in particular predictions, which are priced according to the likelihood the market attaches to each outcome.