Using the Benefits of Augur to Make Money
David Akiloon May 20, 2022.
Augur is a decentralized open-source prediction market created by Jack Peterson and Joey Krug. It is one of the major first decentralized applications (dApps) on Ethereum and proves the viability of this concept for blockchain technology. Augur leverages the "crowd's wisdom" to produce predictions for any outcome, from election outcomes to the winner of sports events.
Augur is an Ethereum-based, decentralized, and trustless protocol for forecasts and predictions about real-time events. Users can easily make market predictions and use their forecasting skills to predict the correct outcomes of future events. Essentially, Augur is a way for people to make money by predicting what will happen in the future.
The platform allows users to predict the outcome of future events and monetizes it. Those whose predictions come to pass will receive money as rewards, while those who fail to speculate the correct answer will lose money. Augur is a decentralized speculation or gambling market platform. It doesn't belong to any single person or company and cannot be shut down by any entity.
Augur launched in July 2018. Following its launch, the team behind Augur raised funds in an initial coin offering (ICO), which saw them raise $5.5 million after selling 8.8 million REP coins—the native coin of the Augur platform.
Pros and Cons of Augur
- Solid reputation as one of the oldest DApps on Ethereum
- Deploys self-executing smart contracts, eliminating human error and manipulation.
- Transparent and decentralized prediction market, making the system fair and censorship proof.
- Augur version 2 came with new crypto tools, including IPFS, MakerDAO's Dai, 0x Mesh, and Uniswap's pricing oracles.
- The platform is still in the beta testing stage.
- Slow update rollout. Augur V2 came out in 2020, 5 years after the release of the original Augur.
- Limited cryptos are available for betting as users can only make bets using ETH and bitcoins.
How Does Augur Work?
As a dApp-based protocol, Augur runs through a series of automated executable smart contracts that ensure the correct information is transmitted from the real world to Augur's oracle and put to use on the blockchain.
Augur accomplishes this via four fundamental processes:
- Creation Anyone on Augur can create a market, essentially proposing a potential event and allowing people to bet on the outcome. For instance, markets like "Will Elon Musk buy Twitter?" or "Will there be a red wave in the US midterm elections?" Market creators can set a creator fee in Ethereum (ETH).
- Trading At this stage, the Augur protocol allows users to buy shares by placing bets on the preferred outcome of any singular real-world event. During trading, the share price of any real-world event is determined by the likelihood of the event's outcome. Therefore, the more people buy into a result, the higher the share price.
- Reporting This stage happens after the market's creation. Reporters feed Augur's oracle with accurate real-world data concerning the event's outcome while receiving rewards for their efforts. Augur's oracle will then determine the final outcome of the event and begin settlement. Reporters who consistently offer accurate information are rewarded monetarily, while those who report contrary to consensus are penalized.
- Settlement This is when traders close out their positions in the markets and collect payouts as profits. Smart contracts execute and reward users who got that bets right and report accurate information. The rewards are paid out in reputation tokens (REP).
Features of Augur
To realize its primary objective, Augur has numerous unique features.
- Low activation fees Augur charges low activation and trading fees to users who activate their trading accounts via "augur marketplaces."
- Augur Oracle This is an information base containing the outcome of various world events. Augur uses its oracle to figure out event outcomes and make accurate settlements.
- REP tokens Function as a reward mechanism for reporters on Augur and as a speculative investment for those who believe decentralized prediction markets like Augur will become prominent in the future.
- Accurate betting platform Thanks to its decentralization, oracle, and smart contract deployment, Augur provides users with a precise gambling system free of error and manipulation.
Augur and REP Tokens
REP tokens are the native tokens of the Augur prediction market ecosystem. They function as reward incentives for Oracle reporters and allow users to create markets, dispute market outcomes, or purchase participation tokens. Users do not need REP tokens to place bets on Augur. Its primary function lies in the reporting aspect of the Augur betting process.
The Benefits of Owning REP Tokens
- Holding REP tokens allows a user to become a reporter on Augur while earning rewards for accurate reporting.
- REP token holders are entitled to 1/22,000,000 of all market fees from any Augur marketplace event.
- Access to precise bet prediction while paying lower trading fees.
- REP tokens also give holders the ability to dispute market outcomes
How to Buy and Store REP
Step 1: Log on to Binance or Coinbase Pro with a strong username and password.
Step 2: Find a market for REP tokens and purchase them using USD or any crypto of your choice.
To Store Your REP Tokens
- Find a suitable wallet for storage. (Exodus Wallet, Jaxx Wallet, or Metamask, all support REP tokens)
- You can also keep your tokens on Augur via hard wallets like TREZOR One and the Ledger Nano S Wallet, which are currently the most popular.