Augur Reputation tokens (REP) will be released to ICO participants tomorrow, after a year of development. Eventually REP tokens will be used with the Augur platform, which is the first decentralized prediction market built on the Ethereum blockchain. Exchanges such as Poloniex and Kraken have already announced that trading and deposits will be enabled for REP tokens on their exchange.
The Augur team is building the tech but wont be directly in control of the platform. The community will create its own markets and participants will be able to place bets on each market. After each predicition event is finished, the REP token holders will report the results, creating a free market system.
Augur will give people the opportunity to put their money where their mouth is, for things like the presidential election, e-sports, baseball, football, hockey, golf, the UFC, and many others. The Augur team is working on creating a fair market with each bet weighted according to volume and the number of participants.
For example, if a person wanted to place a bet on the market above, betting against the popular choice Conor McGregor, a bet would cost $0.31 a share. After the bet was placed, the odds would shift because the new bet added more weight to Eddie Alvarez winning the fight. If Eddie Alvarez were to win the fight, then the bettor would earn $1 for every share that the he/she bought.
Market makers will have to pay a fee to start a market and in return they will receive half of the trading fees from the market that they created. REP token holders receive the other half of the fees from every market, which is distributed equally between all participating tokens in exchange for reporting the results of events honestly. Many people will report on each market and if someone submits dishonest results they can lose up to 20% of their reputation tokens.
The current state of gambling and betting in the US is heavily restricted. Since the Augur platform is decentralized, it will be difficult to limit or shut down.
Augur may offer people a platform to start trading and betting where they couldn’t before. Sports betting is a huge industry, research shows the US is estimated to have nearly 100 Billion dollars of expected betting in 2016, 96% of it being illegal.
The Augur platform is expected to release in Q4 of 2016 and it should attract a lot of new users to the cryptocurrency community.
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