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Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

augur.net

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Re: Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

#3

Post by cryptonerd »

Hmm...this seems like a very interesting venture. I remember websites like this (there was one where you could bet on practically any event, but the name escapes me). I read the paper and found many of the concepts very interesting. The question is, capitalism (as we know it) is built upon trust; it is the essential value needed in capitalism, so how will a "trustless" prediction market work? I'm very interested to see how this works out.

Re: Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

#5

Post by diminou »

cryptonerd wrote: post #3

Hmm...this seems like a very interesting venture. I remember websites like this (there was one where you could bet on practically any event, but the name escapes me). I read the paper and found many of the concepts very interesting. The question is, capitalism (as we know it) is built upon trust; it is the essential value needed in capitalism, so how will a "trustless" prediction market work? I'm very interested to s…

Perhaps you remember InTrade? Or there's also a few UK websites like that. The problem is they're centralized, so they can go out of business or a person who judges / shows the outcomes of events could lie to get a payout.

As for capitalism, I would argue that greed is one of the most common elements. We rely on people being greedy and, generally, willing to do the least work for the most possible results - aka laziness. It's trustless in the sense that bitcoin is trustless, we're building a platform that unlike the traditional financial system, doesn't require you to trust others.

The way the trustless aspect is used is that people are incentivized to vote on the outcomes of events with the consensus, because if you don't, you will lose reputation in the system. This is explained in further detail in the game-theoretical explanation of this project, available here: https://github.com/psztorc/Truthcoin/blob/master/docs/Truthc...

Re: Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

#6

Post by thecabinet »

I'm no Bitcoin expert, but from skimming the paper it seems that the way they were able to achieve this (being "trustless") was by adding new opcodes. You record your position and commitment to the wager in the blockchain, at which time your coins are transferred to a "sidechain". Basically, the blockchain itself holds all the wagered coins.

The part that seems a little weak is they've created a new resource, Reputation, that allows you to report the outcome of a wager. Reputation is tradeable, and therefore gameable.

Re: Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

#8

Post by otoburb »

Appreciate the attribution to TruthCoin[1]. Was Auger implemented in consultation with the TruthCoin author? Curious to know his thoughts.

EDIT: According to the Auger whitepaper[2], Paul Sztorc provided feedback.

[1] http://www.augur.net/code/

[2] https://github.com/tensorjack/Augur/blob/master/augur.pdf?ra...

Re: Wager on Anything Using Bitcoin – Decentralized, Trustless Prediction Markets

#9

Post by randallsquared »

cryptonerd wrote: post #3

Hmm...this seems like a very interesting venture. I remember websites like this (there was one where you could bet on practically any event, but the name escapes me). I read the paper and found many of the concepts very interesting. The question is, capitalism (as we know it) is built upon trust; it is the essential value needed in capitalism, so how will a "trustless" prediction market work? I'm very interested to s…

In that sense that capitalism requires trust, this is "full trust" rather than "zero trust".
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