Month: July 2018

Posted on

Augur

What is Augur?

Augur is an Ethereum based, peer2peer, decentralized oracle and market prediction platform.

It allows users in its platform to craft markets for questions they might have on different issues and make profits from trading that allows people to buy positives or negatives for future events.

The Augur system allows users to trade in the prediction markets at a very low cost. The main expense involved is that participants compensate the creator and those who make the correct prediction.

A small amount is also used to reward those who provide the correct information about the markets. The platform was founded by Jack Perrson and Joey Krug, is written in JavaScript and Solidity, and runs as a decentralized app (DApp).

By employing smart contracts in the Ethereum network, the markets are automated so that no one has control over how it resolves questions or spends funds. This implies that no one, not even the market creator can approve or reject a trade, modify, undo trade, or even cancel orders. When a position is taken, it must hold until the end.

What is the problem that Augur Solves?

In the past, prediction markets were highly centralized. The markets had to rely on trustworthy entities to maintain public ledgers. This opened them to huge manipulation.

In many cases, the betting organizations easily manipulate the outcomes and at times cancel orders to ensure that the creators pocket hefty profits. Most of them can easily turn into theft and serious corruption rigs with little motivation to users.

The centralized market prediction system implies that the traditional market prediction systems could not be trusted. Besides, they also limited the markets such that you can get a betting platform that only limits operations to Soccer, Athletics, or even racing. Others even limit participation to specific regions.

The design of most traditional prediction markets makes them highly inflexible. Their design locks out any suggestion or even introduction of new markets which limits those who can get involved. Most prediction markets will not allow you to venture into unlisted markets.

For example, it is impossible to predict a political event or an entertainment competition on a common sportsbook. These are the issues that Augur targets to address.

How does Augur solve the problem?

The main method used to address the problems of the prediction markets platforms is decentralization. Augur created a platform that allows every person to create markets around major questions and make huge profits from them. This is achieved through two main things; creating markets and trading event shares. But in this case, the list has been extended to include the native token, Reputation (abbrev REP) that is used for payments in the Augur system.

Creating markets

In order to create a market, a user is required to put forward a small amount in Reputation (REP). Once you create a market, you are required to set the fees for the maker and taker. The fee is the cost of purchasing and selling shares on Augur. The taker fee at the platform is required to be within the range of 1.0% and 12.5%. Then, the maker fee cannot surpass the taker fee by 50%. When the market closes, this is the fee you will receive as the market creator.

Augur plans to set a creator fee that will help to address the ups and downs of calculating the maker/taker fees. The creator fee will be taken from rewards of traders who win positions and channeled to the market creator.

To attract more people, the market creator should try to keep the fee low. However, the fee should be high enough to meet the original cost used to create the market. This implies that you need to have the bigger picture of the market and get the expectations right. This is why market creators are advised to focus on areas that evoke a lot of interest.

  • Trading event shares

In addition to creating markets, users in the Augur system are allowed to buy and trade shares representing odds that the picked event will have a specific outcome. For example, a common question that a market creator would have posted towards the close of 2017 about Bitcoin was, “will Bitcoin price hit $20k by the close of 2017?”

Because of the huge interest in Bitcoin by 2017, this market would have been of great interest to you. If you are fairly confident it will hit $20k mark, you can opt to buy about 100 shares. The higher the price of the shares you go for, the stronger is your belief that an event will happen. Note that this is an example of a binary prediction (yes/no) model, but other prediction models can still be used.

As a trader, you can make money in two ways. One, you can take advantage of price fluctuations where shares are bought at a lower fee and then sold at a higher rate when the sentiments change. It is important to look for real-world catalysts when planning to cash on price fluctuations.

Two, you can make cash if you made the right prediction and still hold shares by the time the market closes. In such a case the payout will look something like this.

Payout=No of Shares *Price/No of Ticks. (The ticks are the number of possible price points between the lowest and highest price in the markets)

It is also important to appreciate that you are required to pay the settlement fee for every winning. This includes curator fee and reporting fee for the Decentralized Oracle System. The higher your earning, the higher the fee.

  • The Augur Reputation Tokens (REP)

The Augur Decentralized Oracle System is powered by the REP token. Users are required to stake REP in order to report outcomes of events for various markets. When the market closes, you are required to report the outcome of the event and put some REP to back the claim. If the event did not happen, it becomes invalid (you cannot report on it).

After the market closes, a window of 27 days is available for submission of reports. If the report is the same as the majority of other reporters, the REP you had put forward will be returned plus a reporting fee. Here is the fee for reporting calculation formula.

Reporting fee=the present reporting fee*(open interest on Augur*5/REP Market Cap).

Note that new reporting fee is calculated every thirty days. If you staked more when submitting the report, the reporting fee will be greater.

Other important components in the Augur Decentralized Oracle include;

  • Appeals bond: This is the bond posted by anyone on the Augur system to have an Open Market Re-adjudicated.
  • Blockchain fork: When the number of transactions divide into two separate timelines because of reconcilable disagreements.
  • Early resolution bond: This is a bond paid by a person in the Augur system to request a specific market to be resolved prior to its expiry time.
  • Fork bond: This is a bond posted by a person who wants the reputation history fork in order to contest the consensus that was reached at the appealed markers re-adjudication.

What makes Augur better than it’s competitors?

The main focus of the Augur development team was to disrupt the prediction market by empowering users to get actively involved.

By changing how the markets are identified and prediction run in a decentralized manner, Augur set itself against the top prediction giants such as casinos.

Here are the main things that make Augur better than its competitors.

  • The transaction fee at Augur is very small

Augur is a platform that allows users to create the markets and incentivize more people to get involved directly. This implies that there are no third parties that make the conventional prediction markets expensive. Because payment is paid on a peer2peer basis, there is no middleman or company seeking to profit from predictions. Since payment uses Ethereum based REP, the payments are also not effected via centralized organizations such as banks or credit cards that further raise associated costs in conventional prediction marketing.

  • There is no limit on the markets that can be created

In the Augur system, there is no limit on the markets that can be created. This implies that there are limitless prediction opportunities for prediction enthusiasts. You can opt to create a market in sports, politics, or any other area. This makes it a better option compared to the conventional prediction markets that only focus on major events such as major sports events in major leagues or racing events.

  1. Anyone can create a market on the Augur system

While the traditional prediction markets only allowed their administrators to create the markets, Augur empowers anyone on its system to create markets. This means that you do not have to look at standard betting events and wonder how they were done. Simply join Augur to get an equal opportunity to also create such markets and generate huge returns from it.

  • Augur system implements automated payments

In standard market prediction systems, payments after making a correct prediction are never direct. In most of the cases, a raft of conditions has to be met before a win is released to your wallet. For example, you might be required to roll the win on a number of times before withdrawals can be effected. However, Augur system is run via smart contracts where payment is automatically effected once the correct prediction is confirmed.

  1. The Augur system is open to all

A closer look at the traditional prediction market indicates it is highly selective. Most of them are run under strict local and international laws which limits those who can be involved. In some cases, countries have very strict laws that prevent their citizens or specific groups of people from getting involved. However, Augur is open to all. No matter where you are located, the platform is a decentralized system where anybody can get involved without worrying about getting discovered by third parties.

  • Augur ecosystem has its own cryptocurrency

Most conventional prediction markets lack their own currencies. This implies that they have to rely on the fiat currencies and payment services such as credit cards that easily push the cost up. However, Augur is a step ahead of them because it has own cryptocurrency. This means that everything is housed in the same ecosystem. From market creation to information gathering, prediction by users and payments are all done in the same system. The only point where Augur relies on another party is basing its native tokens, REP, that are based on the Ethereum blockchain. But even this approach helps to amplify the integrity of the tokens because Ethereum is a highly effective and stable platform. This has helped to grow the popularity of Augur and give its value an upward trending approach.

What makes Augur better than it’s competitors?

Augur can be categorized as the new decentralized prediction market that will help to redefine the industry. While the prediction markets is a very huge niche, it has been chocking with the players trying to seek alternatives.

Now, a new option that is Augur has demonstrated that it is possible to free the industry from shackles of centralized monolithic operators. Whether you want to create a market about a local event or a global one, Augur is a reliable platform whose value is expected to grow rapidly because of its structure, rich target, and fast emerging demand.

What’s Augur’s vision on Security?

The main vision on security for Augur is providing users with a completely decentralized and secure market prediction platform. Starting from the beginning, the Augur founders and its development team have been seeking to progressively improve the core code and assure users of optimal security for their assets, information, and predictions. Other methods used to help achieve this goal include;

  • Advanced encryption that helps protect user information at all levels.
  • The Augur native token, REP is based on a highly reputable Ethereum blockchain.
  • The tokens are distributed as rewards to those who make the right predictions or provide correct market info to the Augur system. This helps to prevent 51% attack.

Examples of Augur’s use cases / applications.

Political forecasting: Augur allows users to turn the political knowledge into strong predictive power by trading outcomes. This can be anything from an upcoming election outcome, policy decision, bills on the pipeline, and other political events.

  • Event hedging: The Augur prediction market allows users to hedge against catastrophic events such as natural disasters, market crashes, and even geo-political. When summer approaches, think of predicting the occurrence of a tornado and trade on the outcomes.
  • The weather prediction: Augur allows you to use the power of the crowd to create a highly accurate weather prediction such as daily averages temperatures, heat waves, and others.
  • Company forecasting: For people in businesses, Augur can be a great guide for decision making. The company management can use Augur to predict projection completion timelines, sales, and project completion timelines.
  • In the conventional market such as sports prediction: If you are into sports betting such as soccer and athletics, you can easily cash on creating own markets. You do not have to stick to the old betting model, create your own market and make a huge profit from it.

References

https://coincheckup.com/coins/Augur

http://veritas.veritaseum.com/

https://veritas.veritaseum.com/ve-blog

http://bravenewcoin.com/assets/Whitepapers/Augur-A-Decentralized-Open-Source-Platform-for-Prediction-Markets.pdf

 

Posted on

Golem

What is Golem

Golem is a global decentralized supercomputer that consolidates computing power of all the computers on its network.

Users (providers) in its network can loan their excess computing power to people (requesters) in need of additional computing power for running complex processes.

The model closely resembles the model that Airbnb and Uber use.

For those who have huge computing power, Golem presents a readily accessible and affordable computing power to complete all the tasks they need. The need for extra computing power is very important, especially for those who run intensive activities such as artificial intelligence (AI), natural language processing (NLP), gaming, and machine learning.

The project was started by Julian Zawistowski who runs it together with a team of computing experts based in Poland.  The development team has continued to improve the network through decentralized dedicated software integration into the system.

This implies that any party can create and deploy apps on the Golem network by publishing in its registry. Developers can also use the Transaction Framework to customize payment mechanisms to help monetize their software.

What is the problem that Golem Solves?

The tech world is growing rather fast. Call it supersonic speed. To be specific, the computing niche is in the golden age where the thirst for more computing power is insatiable.

From mobile app developers to space scientists, everything is premised on the ability to have constant, reliable, and highly effective computing power. Today, the computing power is dominated by a few players such as Google, Amazon, and Microsoft.

The near monopoly dominance has made computing power become very expensive. This is the problem that Golem comes to address.

Take a situation of a startup investor with a great idea of crafting new health-related application. Such a new venture is likely to be under financial constraints. Therefore, getting expensive devices for high computing power would not be part of the equation.

But it is not just the startups that would need high computing power. Others who might need additional computational power include government departments, institutions, and even individuals such as gamers.

Golem believes in democratizing the access to computing power so that everybody can easily and cheaply access it. If you have some extra computing power from your computer, you can now act as a provider and lend it to others in the Golem network.

How does Golem Solve the problem?

While the problem of the need for more computing power might be less clear to many people especially those needing standard operations, those running big projects such as application development and artificial intelligence are already in critical need.

To help provide this computing power, the Golem network acts like a supercomputer that uses three primary components;

  • Providers (parties connected to the Golem system and willing to lend extra computing power)
  • The requester (a party in the Golem network and need of extra computing power).
  • The Golem ecosystem that houses both the requesters and providers to make the process of lending computing power effective.

The interaction of requesters, providers, and Golem system

For a requester to get the additional computing power from the Golem system, he has to utilize the available request templates referred to as Luxrender and Blender.

Golem will eventually turn these templates into Golem Shop so that even users with different request templates can still use them. Once a requester selects the request template, the Golem receives the info and adds it in the task manager. Then, it is broadcasted to the providers for consideration.

The provider can select the requesters they want to work with by following their reputation. Once a provider identifies a suitable offer, a price and the computing power details are sent to the requestor.

Before starting to use the computing power, verification will be done to confirm the provider has the power to support the task under consideration.

Once everything is confirmed, the requester gets the computing power via IPFS (InterPlanetary File System) and computation starts running on the provider computer. After the task is completed, results are also sent via IPFS.

Note that the Golem system only facilitates the exchange of computation power. The payment is finally processed via the Ethereum smart contract system. Other features used to facilitate lending and renting of computational power in Golem include;

  • Application Registry: This is an Ethereum smart contract created to help developers publish apps on Golem. The feature makes it simpler for users and requesters to pick the tools they need.
  • Transaction Framework: These are requirements that developers are required to follow when they want to run an implementation transaction model for different apps in Golem.

The Golem Network Token (GNT)

To make the processing of computing power direct and easy, Golem also has a native token referred as Golem Network Token (GNT). GNT is an ERC20 token, and the accepted token that requesters use to pay for computing power in the Golem network. The provider is allowed to set the price for renting their computing power in GNT.

When Golem was launched, a total of 1 billion GNT were minted with 82% of them being distributed through crowdsale. GNT can be traded in the exchanges for other assets such as Bitcoin, Ethereum, and Ripple.

What makes Golem better than it’s competitors?

From the moment that Zawistowski designed to venture into decentralized computing, the battle line with giants such as Google was drawn.

However, the Golem team has been very committed to perfect the decentralized platform through progressive improvement to outdo competitors. Here are some of the top issues that make it better than competitors.

  • The main advantage of Golem over the competitors is derived from the centralized outlook. By offering a decentralized platform for people to sell and rent computing power, Golem is relatively cheaper compared to what Amazon or other computing companies provide.
  • By decentralizing the computing resources through the Golem ecosystem, it is now possible even for small computer owners rent computing resources for specific tasks. This opens the way especially for small to medium computing experts who wanted diversity of computing resources being offered.
  • The Golem platform provides those with computing power the chance to price their computing power the way they prefer. Unlike Amazon or Google where the options are very limited, renters have endless options to pick from. For example, you can check for the offer with the highest computing power but lower rates.
  • When compared to other cryptocurrencies such as Bitcoin and Ethereum that can be classified as blockchain networks, Golem takes a different outlook; ‘’a solution on the blockchain.” This implies that it seeks to provide a solution to computing needs in a decentralized way using blockchain technology.
    Golem is, therefore, better because it can concentrate on its core mandate without worrying about the blockchain that supports its native token, GNT. This is one of the reasons that the Golem team has managed to progressively improve its network.

How can Golem be categorized?

Golem is the first decentralized super-computer that has opened the door to sharing computing power. Even though it was very clear that computing services are growing in demand, few were ready to venture into the niche by adopting fully decentralized systems.

Like Bitcoin pioneered the blockchain technology, Golem has pioneered the decentralization of computing resources. From here, things can only move ahead.

It has also helped to advance the blockchain technology by diversifying into a new area. Bitcoin was focused on decentralized payments, Siacoin ventured into decentralized storage, and, now Golem has extended to decentralize computing.

The Golem roadmap demonstrates that things are just heating up. Whether you are looking to rent or lend computing resources, things are bound to get better with time. Here is the roadmap;

  • Brass Golem that focuses on creating a large user base of requestors and drawing a matching supply of computing power.
  • Clay Golem version aims at expanding the Golem user base by stimulating the initial UX (user experience).
  • The Stone Golem is aimed at stimulating wide scale independent integrations into the network.
  • The Iron Golem is the last version aimed at stimulating success and innovation integrations in the platform.
  • What’s Golem’s vision on Security?

As the first truly decentralized computer, Golem vision is providing a completely secure ecosystem for providers to supply their computing resources to requestors. Unlike the current model where centralized organizations can install specific safeguards on their computers, Golem has to work with many independent providers. Therefore, how is Golem living to its dream?

Security is enhanced through progressive updates that help to seal all the gaps identified in the system. Starting from the Brass Golem version to the final Iron Golem version, the development team progressively builds on the previous successes to keep the network more secure. For example, the data sharing technologies development factor related developments in the industry such as Swarm that enhance the security at different levels.

On the part of the GNT (Golem Network Token), the network builds on the Ethereum blockchain for enhanced security. This means that sending GNT is subjected to verification by miners on the Ethereum network. The miners follow back the public address to ensure that the sender has ample GNT and does not double spend.

Even as Golem works extra hard to ensure that the system is secure, it is important that all users also exercise extreme caution. Whether you are a provider, requestor, investor, or simply a trader targeting the tokens, it is important to get it right on security. Here are a few things you can do.

  • Make sure to be on the latest version of Golem.
  • Keep your computer well protected with the right antivirus.
  • Do not share the private keys and seed phrase of your Golem wallet with third parties.
  • When trading GNT, it is advisable to only select those that have a total commitment to users’ security.
  • When not trading the Golem tokens, make sure to move them away from the exchanges and preferably keep them in cold storage.
  • Make sure to always triple check the public address to avoid sending the tokens to the person.

Examples of Golem’s use cases/applications.

When the phrase hiring computing resources is mentioned, many people think of large projects at the corporate level. Now, Golem has changed this mindset. Golem wanted to ensure that everybody whether at a personal or corporate level can log into the Golem network and promptly access the preferred computing resources. Here are some of these Golem use cases.

  1. Scientific research: Scientific researches mainly entail the handling of lots of data and advanced analytics. They also involve the use of advanced applications that the standard computers might be unable to handle. Whether you are studying bio-fuels, alien life, climate change or DNA technology, Golem is the ultimate place to get the additional computing resources.
  2. Graphics rendering: If your venture deals with things such as virtual reality video games, movies, and designer rendering, a lot of computing power will be required. Golem computing makes everything cheap and easy for you.
  3. Artificial intelligence and machine rendering: These two are some of the fastest growing fields in the tech niche today. Whether it is training machines for medical purposes or industrial automation, Golem will be a great option. activities to current use cases\
  4. Business data analytics: In business, data is generated progressively. You need to understand emerging trends, the competitors, clients’ feedbacks, and other metrics needed to make the right decisions and draw key strategies. Golem provides this computing power at an affordable rate to help keep the cost of operation low and accelerate growth.
  5. Apps developers in the market: If you are an app developer, a lot of computing resources will be required. You can reliably count on Golem it.
  6. Cryptocurrency mining: If you are into cryptocurrencies, you will appreciate that mining is one activity that requires a lot of computing power. For example, if you want to mine top networks that use Proof of Work (PoW) consensus algorithm such as Bitcoin, a lot of computing power will be needed. Acquiring some of the top mining equipment to generate high computing power is very expensive. Therefore, a great alternative is going for Golem computing.

References

https://coincheckup.com/coins/Golem

https://golem.network/

https://blog.golemproject.net/

https://wavesplatform.com/files/whitepaper_v0.pdf