• Latest
How Crypto Transforms Prediction Markets

How Crypto Transforms Prediction Markets

February 18, 2021
ygg sea surpasses 10,000 scholarships in just six months of launch

YGG SEA Surpasses 10,000 Scholarships in Just Six Months of Launch

May 6, 2022
mintable launches industry changing gas free minting service on ethereum

Mintable Launches Industry Changing Gas Free Minting Service on Ethereum

May 1, 2022
5 projects enabling smart contract development on bitcoin

5 Projects Enabling Smart Contract Development on Bitcoin

April 29, 2022
bitcoin atm installed in mexico's senate building

Bitcoin ATM installed in Mexico’s Senate Building

April 27, 2022
cross chain services play a crucial role in facilitating continued adoption of defi applications

Cross-Chain Services Play a Crucial Role in Facilitating Continued Adoption of DeFi Applications

April 26, 2022
justin sun launches usdd, integrating the blockchain world and the real world with the decentralized stablecoin

Justin Sun Launches USDD, Integrating the Blockchain World and the Real World with the Decentralized Stablecoin

April 25, 2022
nfts: the next musical revolution

NFTs: The Next Musical Revolution

April 24, 2022
things you should know before investing in nfts

Things You Should Know Before Investing in NFTs

April 24, 2022
what are wrapped tokens?

What Are Wrapped Tokens?

April 23, 2022
what is the future of ethereum (eth)?

What is the future of Ethereum (ETH)?

April 22, 2022
green gaming

Everything You Need to Know About Play-to-Earn on Algorand in 2022

April 21, 2022
$ape going bananas as rumors of upcoming land sale of bayc metaverse gather momentum

$APE Going Bananas As Rumors of Upcoming Land Sale of BAYC Metaverse Gather Momentum

April 21, 2022
  • Home
  • Coin Market Cap
  • Bitcoin
  • Ethereum
  • Ripple
  • Litecoin
  • Alt Coin
  • Business
  • Trading
  • Mining
CoinNewsDaily
  • Home
  • Coin Market Cap
  • Bitcoin
  • Ethereum
  • Ripple
  • Litecoin
  • Alt Coin
  • Business
  • Trading
  • Mining
No Result
View All Result
  • Home
  • Coin Market Cap
  • Bitcoin
  • Ethereum
  • Ripple
  • Litecoin
  • Alt Coin
  • Business
  • Trading
  • Mining
No Result
View All Result
CoinNewsDaily
No Result
View All Result
Home Ethereum

How Crypto Transforms Prediction Markets

coinnewsdaily by coinnewsdaily
February 18, 2021
in Ethereum
0
How Crypto Transforms Prediction Markets
189
SHARES
1.5k
VIEWS
Share on FacebookShare on Twitter

Related articles

5 projects enabling smart contract development on bitcoin

5 Projects Enabling Smart Contract Development on Bitcoin

April 29, 2022
things you should know before investing in nfts

Things You Should Know Before Investing in NFTs

April 24, 2022

Prediction markets are speculative platforms where traders can place bets on the outcome of future events, such as “Will Joe Biden win the 2024 presidential election?”. If their bet was correct traders earn money but if they are wrong they lose the wagered amount.

Users obviously want to make money from these markets, which include PredictIt and Iowa Electronic Market. But the reason the type of prediction market has drawn so much academic interest is that they have a solid track record of making correct predictions, sometimes even predicting the future.

Some believe crypto assets can play a role in improving these markets. Right now the markets are highly regulated in the US, and participating in them costs relatively high fees.

Advocates argue that cryptocurrencies can dodge these issues. That’s because with cryptocurrencies users don’t have to place trust in a central entity. With Ethereum, the idea is the rules embedded in its code can guide certain actions in the project.

To test out this lofty hypothesis, a few prediction markets, including Augur and Omen, are now deployed on Ethereum.


Prediction markets FAQs

How do cryptocurrencies improve prediction markets?

There are a number of key reasons why advocates think cryptocurrency helps prediction markets:

  • Open: Cryptocurrencies have no boundaries. Users from around the world can purchase ether and other cryptocurrencies powering the prediction markets. Once users buy cryptocurrency they can send it anywhere around the world. Usually, prediction markets are restricted to use in the countries in which they were created. With cryptocurrencies, restricting this isn’t as feasible.
  • Less restrictive: Many of today’s most popular prediction markets pile on restrictions. If a user is winning in a lot of markets, for instance, they aren’t allowed to bet anymore. Cryptocurrency prediction markets strip away such restrictions, Augur’s website argues.
  • Lower fees (sometimes): Fees on centralized markets are higher than Ethereum fees most of the time. But this isn’t always the case. Ether fees have been swelling recently as the network has grown more popular and, as such, congested.
  • Can’t be closed down: Central prediction markets have been shut down before. Most famously, Intrade stopped serving customers in the U.S. to comply with U.S. law, leading to the demise of the platform. One goal of adding cryptocurrencies to the mix is users can make markets that governments can’t shutter.

That said, experts argue there are other reasons these types of markets haven’t gained more traction so far, including the fact they can be easily rigged. For example, someone could bet that Apple will announce the release of its latest iPhone during a certain time and possess insider knowledge about the event.


How do they work using crypto?

They use smart contracts, a type of innovative computer program that can execute actions automatically without needing an intermediary in the middle to help. In the case of prediction markets, smart contracts receive the money sent in by bettors, then automatically distribute it out to the winners when each market concludes.

In other words, users don’t have to trust decentralized prediction markets with their funds. The smart contracts will execute automatically. The flip side of this, though, is that users have to trust smart contracts, which are still a relatively new technology. Many smart contracts have contained bugs or flawed code leading to loss of funds in the past.

Now, how do smart contracts know who guessed correctly? So-called oracles are data services that feed real-world data to smart contracts. Say a prediction market asks, “Will the temperature be below 30 degrees tomorrow in New York City?” We might use weather.com as an oracle source to help us figure out what the temperature is expected to be on the day of the bet.

Central oracles also have their flaws. Weather.com could be hacked by a bettor who placed a lot of money on “yes,” for example. That bettor could hypothetically hack weather.com and alter the weather data to ensure he or she wins.
The prediction market Omen, for instance, is trying to fix this with a decentralized oracle that compiles data from a number of oracles and removes oracles that do not display accurate data.


Can I make money on prediction markets?

It’s a zero-sum game. If you bet correctly, you will win money from those who bet incorrectly. But if you bet incorrectly, you will lose money.

What are some popular crypto prediction markets?

The best-known prediction markets in crypto are:

Credit: Source link

Tags: AUGUREthereumintradeJoe Bidenpresidential electionUnited States
Share76Tweet47
Previous Post

Kia Motors America Victim of Ransomware Attack Demanding $20M in Bitcoin, Report Claims

Next Post

Safello Partnership Enables Direct Crypto Purchases From Users’ Bank Accounts

coinnewsdaily

coinnewsdaily

CoinNewsDaily.com is an online Crypto Coin News Website that aims to provide latest trendy news from market and around the world.

Related Posts

5 projects enabling smart contract development on bitcoin
Alt Coin

5 Projects Enabling Smart Contract Development on Bitcoin

April 29, 2022
things you should know before investing in nfts
Alt Coin

Things You Should Know Before Investing in NFTs

April 24, 2022
what are wrapped tokens?
Bitcoin

What Are Wrapped Tokens?

April 23, 2022
what is the future of ethereum (eth)?
Alt Coin

What is the future of Ethereum (ETH)?

April 22, 2022
$ape going bananas as rumors of upcoming land sale of bayc metaverse gather momentum
Alt Coin

$APE Going Bananas As Rumors of Upcoming Land Sale of BAYC Metaverse Gather Momentum

April 21, 2022
btc and eth will break all time highs in 2022 — celsius ceo
Bitcoin

BTC and ETH will break all-time highs in 2022 — Celsius CEO

April 21, 2022
Load More
Next Post
Safello Partnership Enables Direct Crypto Purchases From Users’ Bank Accounts

Safello Partnership Enables Direct Crypto Purchases From Users’ Bank Accounts

Categories

  • Alt Coin
  • Bitcoin
  • Business
  • Ethereum
  • ICO
  • Litecoin
  • Mining
  • NFT
  • Ripple
  • Tech
  • Trading

What New here?

  • YGG SEA Surpasses 10,000 Scholarships in Just Six Months of Launch
  • Mintable Launches Industry Changing Gas Free Minting Service on Ethereum
  • 5 Projects Enabling Smart Contract Development on Bitcoin

Subscribe to Get More!

Loading
  • About Us
  • Contact Us
  • Privacy & Policy

© 2018-2021 CoinNewsDaily.com by CoinNewsDaily Inc. Crafted with Love by iFtiDev

No Result
View All Result
  • Home
  • Coin Market Cap
  • Bitcoin
  • Ethereum
  • Ripple
  • Litecoin
  • Alt Coin
  • Business
  • Trading
  • Mining

© 2018-2021 CoinNewsDaily.com by CoinNewsDaily Inc. Crafted with Love by iFtiDev

  • bitcoinBitcoin(BTC)$23,546.00-1.31%
  • ethereumEthereum(ETH)$1,662.49-0.88%
  • tetherTether(USDT)$1.00-0.06%
  • binancecoinBNB(BNB)$330.470.43%
  • rippleXRP(XRP)$0.408677-1.64%
  • cardanoCardano(ADA)$0.405095-0.25%
  • dogecoinDogecoin(DOGE)$0.092376-1.68%
  • matic-networkPolygon(MATIC)$1.240.07%
  • okbOKB(OKB)$41.361.93%
  • solanaSolana(SOL)$24.85-2.03%
  • polkadotPolkadot(DOT)$7.053.96%
  • shiba-inuShiba Inu(SHIB)$0.000012-3.07%
  • litecoinLitecoin(LTC)$99.87-0.30%
  • tronTRON(TRX)$0.063811-1.30%
  • daiDai(DAI)$1.00-0.12%
  • cosmosCosmos Hub(ATOM)$15.283.44%
  • chainlinkChainlink(LINK)$7.28-0.78%
  • ethereum-classicEthereum Classic(ETC)$23.13-1.22%
  • moneroMonero(XMR)$173.15-3.32%
  • leo-tokenLEO Token(LEO)$3.370.18%
  • bitcoin-cashBitcoin Cash(BCH)$138.41-1.95%
  • stellarStellar(XLM)$0.092795-1.24%
  • filecoinFilecoin(FIL)$5.66-1.40%
  • crypto-com-chainCronos(CRO)$0.081098-0.93%
  • algorandAlgorand(ALGO)$0.2691062.06%
  • vechainVeChain(VET)$0.024793-0.16%
  • internet-computerInternet Computer(ICP)$5.88-2.81%
  • aaveAave(AAVE)$90.80-0.44%
  • eosEOS(EOS)$1.09-1.10%
  • elrond-erd-2MultiversX(EGLD)$45.80-1.57%
  • theta-tokenTheta Network(THETA)$1.121.81%
  • tezosTezos(XTZ)$1.141.03%
  • paxos-standardPax Dollar(USDP)$1.000.43%
  • huobi-tokenHuobi(HT)$5.71-3.84%
  • bitcoin-cash-svBitcoin SV(BSV)$43.57-1.15%
  • havvenSynthetix Network(SNX)$2.60-2.05%
  • pancakeswap-tokenPancakeSwap(CAKE)$4.332.41%
  • dashDash(DASH)$63.471.52%
  • iotaIOTA(MIOTA)$0.236830-0.55%
  • neoNEO(NEO)$8.891.90%
  • makerMaker(MKR)$691.18-1.29%
  • zcashZcash(ZEC)$47.180.27%
  • zilliqaZilliqa(ZIL)$0.028871-0.82%
  • basic-attention-tokenBasic Attention(BAT)$0.272710-0.94%
  • compound-governance-tokenCompound(COMP)$54.780.11%
  • nemNEM(XEM)$0.039687-0.03%
  • Elrond ERDElrond ERD(ERD)$0.0259290.00%
  • kusamaKusama(KSM)$38.331.44%
  • sushiSushi(SUSHI)$1.576.44%
  • bitcoin-goldBitcoin Gold(BTG)$17.27-0.96%
  • wavesWaves(WAVES)$2.857.66%
  • qtumQtum(QTUM)$2.77-1.49%
  • yearn-financeyearn.finance(YFI)$7,816.13-1.47%
  • ftx-tokenFTX(FTT)$1.89-21.50%
  • golemGolem(GLM)$0.2502470.57%
  • omisegoOMG Network(OMG)$1.563.52%
  • ontologyOntology(ONT)$0.218525-0.79%
  • digibyteDigiByte(DGB)$0.011144-1.36%
  • umaUMA(UMA)$2.140.40%
  • ethlendAave [OLD](LEND)$0.53-3.08%
  • UniswapUniswap(UNI)$2.4438.80%