Augur (software)

Augur is a decentralized prediction market platform built on the Ethereum blockchain. Augur is developed by Forecast Foundation, which was founded in 2014 by Jack Peterson, Joey Krug, and Jeremy Gardner. Forecast Foundation is advised by Ron Bernstein, founder of now-defunct company Intrade, and Ethereum founder Vitalik Buterin. Augur allows any user to create a prediction market on any topic. There are two kinds of markets: Categorical markets have up to seven options; for example, "Will Alice win X election?" with "yes" and "no" as options, or "Who will win X election?" with five candidates as options. These markets are winners take all, making them similar to binary options. Scalar markets offer a spectrum of numerical outcomes; for example, "What will the closing price of Apple's stock be on January 1 2021?" Traders can "long" or "short" any value, i.e. bet that the result will be higher or lower than a certain value. If a trader longs at X value, the more above X the result is, the more money they make (and similarly for shorts). "Invalid" is one of the outcomes in all markets, which is intended to help prevent scam markets and ensure that market questions and resolutions are unambiguous. To resolve markets, "reporting" fees are used to incentivize the reporting of market outcomes. Augur uses an ERC-20 token called REPv2 to incentivize reporters on its network to back their reports with tokens. The REPv2 token holders are entitled to the trading fees generated on the platform. Augur's security model has been rigorously quantified and shown to be secure. Augur runs on Ethereum. After a crowdfunding in August 2015, the project launched in July 2018. Soon after the platform launched, users had created death pools — or assassination markets — on famous people. Augur's user numbers dropped off sharply after launch in 2018: from 265 daily users in early July, to 37 on 8 August. In July 2018, the Commodity Futures Trading Commission noted resemblance of the Augur contracts to binary options, which would fall under its jurisdiction.