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I sat through some early presentations of Augur at the big monthly Bitcoin meeting that's been running for years in Amsterdam, and my first thought upon seeing

by blunte 8y ago

I sat through some early presentations of Augur at the big monthly Bitcoin meeting that's been running for years in Amsterdam, and my first thought upon seeing it was, "who says what the factual outcome is?". Sure in some cases it's black and white, but like most things in life there is a lot of weight in the interpretation. So it's back to the original problem with smart contracts - you still have to trust an oracle, and I would bet ;) that if the stakes are high enough, an oracle will be manipulated in some way. Let's take an election for example. We've had enough madness just in the US in the last 20 years to be skeptical of initially reported outcomes. In fact, some elections get reversed after study and investigation. Augur isn't going to reverse a funds exchange. And if someone has enough riding on an outcome, they may find it worth spending extra money to at least temporarily cause the outcome to match their bet. They just need to win briefly, even if the results get overturned later.

SuoDuanDao 8y ago
Now I want to read a cyberpunk novel about a team who rigs an election just to steal a bunch of gas from a predictions market. Maybe I'll even get to see it in real life. What a time to be alive.
- blunte 8y ago
  It's all about the bottom line. If you can spend $80k to make $100k, it's worth it to some people. Or $90M to get $100M. Whatever.
darawk 8y ago
> I sat through some early presentations of Augur at the big monthly Bitcoin meeting that's been running for years in Amsterdam, and my first thought upon seeing it was, "who says what the factual outcome is?". Is that a genuine question, or are you confused about the consensus mechanism? The answer to 'who says' is the core of what Augur is: people vote on what the outcome was, in a way that incentivizes them to vote for the answer they believe to be correct. > So it's back to the original problem with smart contracts - you still have to trust an oracle, and I would bet ;) that if the stakes are high enough, an oracle will be manipulated in some way. No, you do not have to trust an oracle. The whole mechanism is actually quite cool, you should check it out: https://www.augur.net/whitepaper.pdf https://www.augur.net/whitepaper.pdf > Let's take an election for example. We've had enough madness just in the US in the last 20 years to be skeptical of initially reported outcomes. In fact, some elections get reversed after study and investigation. Augur isn't going to reverse a funds exchange. And if someone has enough riding on an outcome, they may find it worth spending extra money to at least temporarily cause the outcome to match their bet. They just need to win briefly, even if the results get overturned later. That's easy to solve. You simply define the question in a way that obviates those kinds of issues. In Augur, people vote on the outcome they believe is correct. The outcome of this process is defined as the truth, within the system. Since this is transparent, you place your bets with this in mind. You aren't betting on who will win the 2020 election, you're betting on which answer people will converge on for the winner of the 2020 election. A subtle, but important difference.
- blunte 8y ago
  Then I completely remembered it differently/wrong, and my comments perhaps don't apply! I will review it again.
  - darawk 8y ago
    Just to update, it seems my knowledge is also wrong, or at least, out of date. The way I thought it worked was an earlier draft, but they have some new mechanism that I haven't read about yet.
- pavel_lishin 8y ago
  > You aren't betting on who will win the 2020 election, you're betting on which answer people will converge on for the winner of the 2020 election. A subtle, but important difference. To me, this undermines the argument that prediction markets are a source of truth.
  - flyingfences 8y ago
    The thing with prediction markets, though, is that you're not just betting on which answer people will converge on. You're betting on which answer people will converge on, weighted by their confidence in their choice.
pearjuice 8y ago
FYI, chainlink will solve this problem. They are working on a decentralized oracle solution. You should really read the white paper. Your concern is addressed by having set a collateral demand for nodes participating. So for example the stake is x you want to have an even distribution of x/n nodes to actually insure your off-chain data. If they deliver, smart contracts will actually take off because they can reliably use external data. Right now, there is no way to do so.
tdmat 8y ago
decentralized oracles can prevent manipulation of data unless the point of origin is corrupted.. see Chain Link.

by blunte 8y ago

SuoDuanDao 8y ago

Now I want to read a cyberpunk novel about a team who rigs an election just to steal a bunch of gas from a predictions market. Maybe I'll even get to see it in real life. What a time to be alive.

blunte 8y ago
It's all about the bottom line. If you can spend $80k to make $100k, it's worth it to some people. Or $90M to get $100M. Whatever.

darawk 8y ago

> I sat through some early presentations of Augur at the big monthly Bitcoin meeting that's been running for years in Amsterdam, and my first thought upon seeing it was, "who says what the factual outcome is?". Is that a genuine question, or are you confused about the consensus mechanism? The answer to 'who says' is the core of what Augur is: people vote on what the outcome was, in a way that incentivizes them to vote for the answer they believe to be correct. > So it's back to the original problem with smart contracts - you still have to trust an oracle, and I would bet ;) that if the stakes are high enough, an oracle will be manipulated in some way. No, you do not have to trust an oracle. The whole mechanism is actually quite cool, you should check it out: https://www.augur.net/whitepaper.pdf https://www.augur.net/whitepaper.pdf > Let's take an election for example. We've had enough madness just in the US in the last 20 years to be skeptical of initially reported outcomes. In fact, some elections get reversed after study and investigation. Augur isn't going to reverse a funds exchange. And if someone has enough riding on an outcome, they may find it worth spending extra money to at least temporarily cause the outcome to match their bet. They just need to win briefly, even if the results get overturned later. That's easy to solve. You simply define the question in a way that obviates those kinds of issues. In Augur, people vote on the outcome they believe is correct. The outcome of this process is defined as the truth, within the system. Since this is transparent, you place your bets with this in mind. You aren't betting on who will win the 2020 election, you're betting on which answer people will converge on for the winner of the 2020 election. A subtle, but important difference.

blunte 8y ago
Then I completely remembered it differently/wrong, and my comments perhaps don't apply! I will review it again.
- darawk 8y ago
  Just to update, it seems my knowledge is also wrong, or at least, out of date. The way I thought it worked was an earlier draft, but they have some new mechanism that I haven't read about yet.
pavel_lishin 8y ago
> You aren't betting on who will win the 2020 election, you're betting on which answer people will converge on for the winner of the 2020 election. A subtle, but important difference. To me, this undermines the argument that prediction markets are a source of truth.
- flyingfences 8y ago
  The thing with prediction markets, though, is that you're not just betting on which answer people will converge on. You're betting on which answer people will converge on, weighted by their confidence in their choice.

pearjuice 8y ago

FYI, chainlink will solve this problem. They are working on a decentralized oracle solution. You should really read the white paper. Your concern is addressed by having set a collateral demand for nodes participating. So for example the stake is x you want to have an even distribution of x/n nodes to actually insure your off-chain data. If they deliver, smart contracts will actually take off because they can reliably use external data. Right now, there is no way to do so.

tdmat 8y ago

decentralized oracles can prevent manipulation of data unless the point of origin is corrupted.. see Chain Link.