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Augur Crowdsale Nearing 2000 BTC

[Augur]( is an open source, decentralized prediction market platform that is being built on Ethereum. Designed to allow participants to wager money on any future event of their choosing, the crowdsale is approaching 2000 BTC, raised in just 12 hours.

Augur is an open source, decentralized prediction market platform that is being built on Ethereum. It’s a DApp (Decentralized Application) that has support from some of the most respected names in both the digital currency and prediction market fields. During a crowdsale launched on Monday, August 17, contributors will be able to purchase Reputation (REP), the platform’s own token. The crowdsale started in 5th gear by raising nearly 2000 BTC in the first 12 hours.

“I like to think of Augur as an early warning system for everything. A 21st century ‘crowdforecasting’ tool that could help the world become more aware of new threats and new opportunities and make better decisions.”
— – Peronet Despeignes, Augur Special Ops

Augur aims to make clear estimates of the likelihood of future events. According to the team, the platform is an amalgamation of various ideas, built on concepts from Frederich von Hayek’s “Knowledge in Society”, Robin Hanson’s “Idea Futures”, Aristotle’s “Politics”, Vitalik Buterin’s SchellingCoin, TruthCoin, Joseph Bonneau, and a good amount of community input. The company consists of 7 core team members, acting under a completely flat hierarchy, with every internal decision being made via a simple democratic vote.

“In the true spirit of free software, we borrow ideas from anywhere they’re freely available!”
— – Joey Krug, Augur Core Developer

At it’s heart, the platform is based on a scientific principle known as the “Wisdom of the Crowd,” which states that if you ask enough people something their average answer is far more accurate than any expert.

The basic idea is that two minds are better than one, and a thousand or a billion are even better. Imagine an early warning system for everything that tapped into the collective awareness of humanity. Imagine better forecasts about politics, commerce, technology and more. “Augur is trying to become the world’s first global prediction market as the utilization of worldwide information sources enables it to become the most powerful forecasting tool in history.” Said Tony Sakich, Director of Marketing at Augur.

“There’s a lot of uncertainty facing all of us — at work, in business, finance, economics, politics, international affairs, you name it. We could all use a bit more clarity about the future, but many of the surveys, polls, experts and other mass media we count on to get a sense of where things are going and enable us to take the right course of action, are contaminated by noise”
— – Despeignes

People participate in markets using a “market scoring” rule, so instead of buying “yes” on Hillary directly from another person, you buy it from a pool, controlled by a smart contract. This structure means there is no need for a counterparty trade to settle an order, another person wanting to take your bet, and the odds for yes/no Hillary always add up to one.

Reputation (REP) is the token that allows an individual to report on the outcome of events and receive part of the system’s trading fees as compensation. All 11,000,000 REP tokens that will ever exist will be distributed at the end of the software sale. The distribution of tokens will be constantly shifting in real-time as new participants buy into the system using the “Live-Action” token distribution software to create true free market pricing.

“We hope that our crowdsale will appeal to both cryptocurrency investors and those who are seriously behind the idea of what we are doing with Augur, as they are responsible for the success of the markets being created.”
— – Tony Sakich, Augur Director of Marketing

Users of Augur will be “REP Holders”, Market creators and wagerers and the benefits for each role will be different. REP holders will be able to earn additional REP by actively and honestly reporting on event outcomes for markets that are created within the system. Market creators will be able to earn market fees and wagerers will receive any relevant payouts for correctly predicting events. An interesting feature is the ability for REP holders to report a market as “Unethical” or “Not A Relevant Market.”

“We are trying to follow all regulatory frameworks and feel that this feature will curb a lot of misuse that would otherwise be possible on the platform.”
— – Sakich

REP is an essential part of the Augur platform as it allows the decentralized oracle system to operate. According to the team, the economic value of REP tokens is necessary for users to have an incentive to report event outcomes honestly. Without having a financial stake in Augur, users would be able to report dishonestly and break the algorithm that allows the system to remain decentralized.

The amount of REP always stays the same at 11 million, but how they are distributed among existing REP holders can be in flux depending on their behavior. Existing REP holders can gain REP from other REP holders if they’re more diligent and more accurate in their reporting than other holders. REP will flow towards those who are most reliable and accurate in their reporting of events and flow away from those who are least reliable and least accurate (least aligned with the general consensus) in their reporting of events. Also if someone doesn’t use their REP they are redistributed to other users. REP holders get 50% of all trading fees generated by the platform now and in the future.

“Any Ethereum address, excluding exchanges in the beginning, will be able to function as a REP wallet. Augur will have its own wallet as well. People could trade REP like anything else, except during the second portion of a reporting period, because it needs to be used to report then.”
— – Krug

The platform will be open to all cryptocurrency and proxies available on Ethereum and aims to integrate with bitcoin sidechains as soon as they are available. There is currently an Alpha Preview of the platform for users, but only for “play money.” To be able to integrate with third party systems Augur has written a JavaScript API that allows people to plug into the platform’s contracts. More info can be found in Augur’s Whitepaper, GitHub and API Documentation.

“It’s so thrilling to see the grueling months of effort we have put into this ambitious project so resoundingly validated by hundreds of individuals from all over the world in just a few short hours. We can’t wait to have more and more individuals join us in our mission to create what we believe will be the most powerful forecasting tool in human history.”
— – Jeremy Gardner, Augur Director of Operations

There are more components to be added in the future, according to the roadmap. The next steps toward a beta version include a new consensus algorithm implementation, scalar (0-100), categorical (Bush, Clinton, Trump), and multidimensional markets. Last but not least an accounts system for the web client, together with current bugs fixes within the alpha. The team is also working on finalizing ideas and turning them into a concrete plan for scaling the system, a follow up to the “Scaling Augur” post is to be expected.


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