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Introduction to Augur, an open-source, decentralized betting marketplace

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Re: Introduction to Augur, an open-source, decentralized betting marketplace

#171

Post by skolsuper »

adam wrote: post #119
GreenPlastic wrote: post #89

Earlier quoted context omitted.

Yes, it works very well but not for the 'wisdom of the crowds' effect. It works because the people with the most information and best models sharpen up the price. Over time, the sharpest bettors grow their bankrolls or capital exponentially and place larger bets and have a disproportionate weight on the markets and their opinions matter more, making markets more efficient.

In theory you're right - but this isn't how it works in practice. The people who earn the most money are the best traders, not necessarily the people with the "most information and best models." The overall forecasts tend to be accurate, but you cannot look to individual participants, see who has the most money, and assume they know the most about the subject at hand.

Both right: on an individual level the people with the most money might or might not be the smartest, but in aggregate the money moves towards the smarter bettors, weighting their votes higher in future rounds, improving the aggregate intelligence of the market.

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#172

Post by goldenkey »

nyolfen wrote: post #161
cryptobeanbaby wrote: post #156

Earlier quoted context omitted.

To quote a prior Senate Minority Leader Tom Daschle on the floor of the Senate: "How long would it be before you saw traders investing in a way that would bring about the desired result?" As in, if one found a way to bet against your car remaining in tact and realized sabotaging your car was cost effective to manipulate their bet, then they reap the market pay out. Is this good? https://en.wikipedia.org/wiki/Informat…

this is the idea behind assassination markets

Interesting...so when enough "life insurance" has been taken out on someone, it becomes more profitable to protect them or to kill them, depending on what the relative odds are, and which side the potential assassins have placed their money?

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#173

Post by allenlavoie »

cryptobeanbaby wrote: post #156
ansiton wrote: post #147

Earlier quoted context omitted.

Do you have citations for this? The academic papers I've read on prediction markets are (broadly) positive.

To quote a prior Senate Minority Leader Tom Daschle on the floor of the Senate: "How long would it be before you saw traders investing in a way that would bring about the desired result?" As in, if one found a way to bet against your car remaining in tact and realized sabotaging your car was cost effective to manipulate their bet, then they reap the market pay out. Is this good? https://en.wikipedia.org/wiki/Informat…

We already have a much more liquid terrorism futures market, i.e. the regular stock market. Worrying about incentives for a large attack from a prediction market is missing the ocean for a hypothetical raindrop.

Incentives in smaller markets (e.g. local elections, or personal car crashes as you say) are super interesting though.

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#174

Post by arthur_pryor »

dragonwriter wrote: post #153
hedgew wrote: post #7

Augur will probably be used for betting but really it's a prediction market. https://en.wikipedia.org/wiki/Prediction_market Prediction markets are an interesting tool for determining the most likely answer or result for almost any question. Some economists hope that we could use prediction markets to make difficult political decisions. Many companies already use them internally. Sadly there's only one prediction mar…

> Augur will probably be used for betting but really it's a prediction market. A prediction market is an attempt to leverage a hypothesized predictive power of aggregated betting, so being used for being is essential to being prediction market. > Some economists hope that we could use prediction markets to make difficult political decisions. Political decisions aren't verfiable fact questions, so they aren't really s…

> > Some economists hope that we could use prediction markets to make difficult political decisions.

> Political decisions aren't verfiable fact questions, so they aren't really subject to prediction markets. You could use them as a tool to get possible answers to fact questions supporting policy decisions, but there is no real compelling case for them being better than the best available other methods in most domains for that, and in any case getting answers on fact questions related to policy decisions isn't even the hard part of getting good policy decisions.

i wish this comment/POV had gotten more traction in this thread. i am increasingly of the opinion that building consensus on values and goals is more of a problem in politics than is building consensus on facts.

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#175

Post by whazor »

The maker of Augur, Joey Krug, recently posted an analysis[1] providing the arguments why Augur is at the moment still too expensive. For me this is very insightful into why Ethereum applications are not yet super successful.

[1] https://medium.com/@joeykrug/fees-fees-and-fees-8939c2b5ecae

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#176

Post by AznHisoka »

gcb0 wrote: post #150
zodiac wrote: post #146

Earlier quoted context omitted.

> At that point they are no better than simply looking at the stocks (the predicted market). Are you assuming that prediction markets are only over stock prices? What about a market about the winner of the next US presidential election?

if you have a market where I can make tons of money of it, at which point do you expect me to start contributing to PACs just to win the bet? see the problem?

What’s the problem? Public companies with the majority of shares owned by the executives have this same incentive.

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#177

Post by AznHisoka »

blanderman wrote: post #3

"In the summer of 2018, assassination markets became popular among bettors. If those markets are seen to incentivise people to take illegal action, Augur could be shut down completely."

Seems like a very low probability event. This would’ve been done in the stock market a long time ago if this was a problem. Buy put options on Berkshire Hathaway and then kill Warren Buffet a few days later. Profit.

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#178

Post by dillonsettle »

hedgew wrote: post #7

Augur will probably be used for betting but really it's a prediction market. https://en.wikipedia.org/wiki/Prediction_market Prediction markets are an interesting tool for determining the most likely answer or result for almost any question. Some economists hope that we could use prediction markets to make difficult political decisions. Many companies already use them internally. Sadly there's only one prediction mar…

The iCash team is working to solve the governance issues in blockchain. Their work towards creating an automated & self-sufficient economy has really impressed me.

Especially being their work is in the prediction market space and covers a lot of the current limitation issues we face.

Source Link: https://medium.com/@iCash.io/processes-for-arbitration-on-sm...

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#179

Post by nybble41 »

cryptobeanbaby wrote: post #156
ansiton wrote: post #147

Earlier quoted context omitted.

Do you have citations for this? The academic papers I've read on prediction markets are (broadly) positive.

To quote a prior Senate Minority Leader Tom Daschle on the floor of the Senate: "How long would it be before you saw traders investing in a way that would bring about the desired result?" As in, if one found a way to bet against your car remaining in tact and realized sabotaging your car was cost effective to manipulate their bet, then they reap the market pay out. Is this good? https://en.wikipedia.org/wiki/Informat…

> As in, if one found a way to bet against your car remaining in tact and realized sabotaging your car was cost effective to manipulate their bet, then they reap the market pay out.

You just described insurance fraud. And just like in insurance, the fix is to be very careful about how you describe the "win" condition—not just "will the car become damaged" but "will the car become damaged through no fault of the owner" (to begin with; the actual terms would be much more complex).

Re: Introduction to Augur, an open-source, decentralized betting marketplace

#180

Post by theptip »

MusaTheRedGuard wrote: post #123
theptip wrote: post #77

Earlier quoted context omitted.

How would you hedge the value of ETH? I'm not aware of a way to short it.

Multiple ways to short ETH, as mentioned by another user. Including on augur itself! See: https://augur-cfd.com

Sure... in theory. I'm skeptical that there is going to be anywhere near as much demand for 5x levered exposure to ETH as there is for shorting ETH.
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