Augur coin (Rep) – A Exceptional Beginner’s Guide (How it Works)

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Augur is a decentralized predictive market platform that uses the Ethereum network. In a predictive market, you can bet on the results of future events to win cash prizes. The less likely an event is to occur, the greater the reward you can earn by predicting its success.

What is Augur?

Augur uses the concept of “The Wisdom of the Crowd” – in other words, “crowd awareness” – of all the predictors of the platform to create real-time predictive data that is often more accurate than the best experts.

What is Augur

By bringing blockchain technology to the betting community, Augur offers you a cheaper, more accessible and more accurate option than other markets.

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How does Augur work?

The two main options available to you on Augur are:

  1. Create markets
  2. Exchange event shares

Create markets

You have to spend a small amount of Ethereum to create an Augur market. An example of a market could be “Will the price of bitcoin reach $ 20,000 before the end of 2017? But just as well “The aliens will come to Earth in 2018? “

When you create a market, you set the costs of the buyers and sellers (the cost of buying and selling shares in the books). Buyers’ fees must be between 1.0% and 12.5%. The seller’s fees can not exceed half of the buyer’s fees. As market creator, these are the fees you will receive when the market closes.

Although this is the current pricing structure, discussions on the official Stack Exchange page suggest that this will change.

Soon, market creators will instead set creative fees, and there will be no more seller/buyer fees. The creator’s remuneration will be deducted from the rewards of the traders who hold winning positions and will be given to the creator of the market.

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As a market maker, you are looking to keep transaction costs low enough to entice people to bet on your market. However, they must be high enough to cover the initial cost of the Ethereum that you spent to create the market.

Exchange event shares

In addition to creating markets, you can buy and trade stocks that represent the chances of an event happening in a market. For example, you might see a market: “Will Bitcoin Cash reach $ 6,000 by 2018? “

(For simplicity, we will stick to the binary markets, yes/no, in this article, here you will find a full explanation of the different markets)

Since Coinbase recently added Bitcoin Cash to its platform, this market is of interest to you. You’re pretty confident that it will reach $ 6,000 before the end of the year, so you made an offer to buy 50 shares at 0.6 ETH per share.

The actions are between 0 and 1 ETH. The higher the price at which you buy an action, the more likely you are to have the event happen.

Exchange event shares

There are two ways to make money as a trader. With the fluctuation of stock prices, it is possible to buy positions at low prices and sell them more expensive when the feeling changes. Real-world catalysts can make an event more or less likely to happen over time.

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You can also earn money if you have correctly predicted an event and hold shares at the close of the market. The amount of your payment is equal to:

Payment = Number of shares * Price / Number of brands

The number of brands is the number of possible price points between the minimum and maximum prices of a market.

You must pay the settlement fees for each of your winnings. Settlement fees include the creative fee set by the market creator and the reporting fee used in the decentralized Oracle system. The higher your income, the more you will have to pay.

Tokens REP (Reputation)

The REP token powers Augur’s decentralized Oracle system. You place REP to bet on the outcome of events in different markets.

When a market closes, you report on the outcome of the event and establish a certain amount of REP to justify your request. If the event has not yet occurred, you must mark it as “Invalid” because you will not be able to declare it.

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You have 27 days after the close of an event (the reporting phase) to submit a report. If you report the same result as the majority of respondents in your market, you will receive your REP plus a portion of the reporting fee. The report fees are calculated according to the following formula:

Reporting Fees = Current Reporting Fees * (Augur Open Interest * 5 / REP Market Capitalization)
Augur calculates new reporting fees every 30 days.

The more you invest in REP when you submit a report, the greater the proportion of commissions you earn.

Tokens REP (Reputation)

To make things a little more complicated, markets can also be reported by a designated rapporteur. The market creator delegates to a designated reporter the report of a proposed outcome for the market within 3 days of market closure.

As rapporteur, you have three additional days to challenge the nominated rapporteur’s proposed result. If there is no dispute, the market enters the next reporting phase and skips the usual 27 days.

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You have to put a few PWRs into play to challenge a proposed result. The REP you hold is called a protest bond. If your challenge is successful and the proposed outcome is reversed, you will recover the funds from your surety.

The team behind Augur and progress of the project

Created in October 2014 as one of the first platforms built on Ethereum, Augur is highly respected in the cryptographic world . Jack Peterson and Joey Krug lead the team of 13 people. They both have great experience in blockchain technology and have already created Sidecoin – a bitcoin fork.

The team behind Augur and progress of the project

Vitalik Buterin, creator of Ethereum, is advisor to Augur.

The team released the first public release of Augur in June 2015. Shortly after, Coinbase selected Augur as one of the five most exciting Bitcoin projects in 2015 . The beta version was released in March 2016.

Augur’s biggest competitor is Gnosis. Both projects involve teams with extensive experience in the prediction and blockchain market and use similar technology to create nearly identical products. The main difference between the projects lies in their business model. Augur receives fees based on the volume of transactions while Gnosis fees are proportional to the shares outstanding.

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Even with similar products, the market is large enough for both platforms to exist together.

Trading Augur REP

Augur held an ICO in August 2015 in which it distributed 8.8 million REP tokens . There are and will be only 11 million REP tokens in circulation.

REP was trading between $ 1.50 and $ 2.00 (~ 0.0047 and ~ 0.0050) immediately after ICO. Since then, the price has had three important peaks in its history.

Trading Augur REP

The first occurred in March 2016 following the launch of the beta.

The second took place in October 2016, when investors received their REP tokens from ICO. This resulted in a rapid increase in the price before dumping, as trading platforms increased their support for tokens. Although this behavior seems strange, it is a common phenomenon after ICO. Many investors do this to gain profits from the price increase that occurs between the time of the ICO and the moment the company frees the tokens.

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The third and largest price hike took place on December 19, when the price climbed to over $ 100 before settling at around $ 90. No significant news seems to have caused this increase.

Some people have thought that this peak is the result of a classic “pump and dump” while others believe that it could be due to insiders speculating on the rumor that the token will soon be added to Coinbase.

Where to buy REP

As with most altcoins, you can only trade them using Bitcoin or Ethereum. For starters, you can buy Bitcoin or Ethereum on a platform like Coinbase and then transfer them to the exchange of your choice. You can then buy REP on Binance for example. Coinbase is the reference to buy your first cryptocurrencies, which we recommend.

Binance is the recommended trading platform to buy REP. Kucoin also offers REP. These two Chinese platforms have become references in the exchange of cryptocurrencies.

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Alternatively, you can also use Kraken to buy REP directly in EUR. You can also take a look at CoinMarketCap for a complete list of awards where REP is available.

Where to store REP and its Augur

Augur did not create a specific wallet for the REP token, but you still have a lot of options. Jaxx and Exodus are two reputable online portfolios that support multiple currencies, including REP.

The recommended way to store REP is with a hardware wallet. Using a hardware wallet protects your funds against malware and hackers. The Ledger Nano S and Trezor wallets support REP tokens and are both excellent security options.

Conclusion – Should I invest in Augur and buy REP?

Augur is one of the oldest projects on the market and was one of the first to be built on Ethereum. The platform is a decentralized market for predictive markets and event trading.

Augur uses “The Wisdom of the Crowd” to accumulate predictive data and report the results of events . The team has experience working in predictive markets and has been working on its product for over two years.

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Even with the recent price hike, it is not unlikely that you will see another big comeback coinciding with the official release of the Augur Mainline this year.