Augur crowdsale

[zack]

47 minutes since the crowdsale started.
179.65974282 BTC
2686.35487879 ETH
https://sale.augur.net/?locale=en

Looks like people want to invest in prediction markets.

[psztorc]

The technology won't work...I tried to warn people, but I guess Augur has to make a return for their investors, and no one wants to do due diligence.

Still, I suppose it will be interesting to see [1] how many people are interested in participating in something like this and [2] how gullible the Bitcoin community is.

[zack]

It has been 30 hours and 40 min since it started.
2989.83294846 BTC
513399.10038364 ETH

Anyone want to bet how much time passes until trading fees give the votecoin-holders their original investment back? $1 million is a lot of money.

Since ethereum allows you to make contracts that bet on augur without having to pay the fee, then the fee is like a voluntary tip. The gamblers don't have to pay if they don't want to.
Default settings are a powerful force. It is possible that a majority of traders pay the fee anyway.

[psztorc]

It has been 30 hours and 40 min since it started.
2989.83294846 BTC
513399.10038364 ETH

Anyone want to bet how much time passes until trading fees give the votecoin-holders their original investment back? $1 million is a lot of money.

Part of the problem with crowdsales is that you can sell some to yourself and inflate the "funds received" number. It's a smart idea, and someone who used to work at Augur (but no longer does) expressed an interest doing it during their crowdsale (hey, who knows).

Secondly, I still think that people don't totally understand that they can use the system for free (or that they are paying a 20% markup fee). Likely plenty of people don't care and are just wowed by the project and want to be a part of it.

The sun is setting on the current period (2014-2015), one where a recently-increased Bitcoin exchange rate (and Ethereum, given that it was originally "valued" at >$18 million for 80%) overlapped with the introduction of new projects which might, possibly, replace Bitcoin as Victorious Currency. People have a lot of (somewhat unspendable) cash, but not a lot of time/relevant-expertise.

Since ethereum allows you to make contracts that bet on augur without having to pay the fee, then the fee is like a voluntary tip. The gamblers don't have to pay if they don't want to.
Default settings are a powerful force. It is possible that a majority of traders pay the fee anyway.

Given "once a parastic contract exists, it's fate will be exactly the same as its host's", the risk-reward for both parasite and host is identical (unlike a bootleg movie where the quality may be lower). I think professional money-seeking traders are likely to consider the fee.

But the greater concern is higher-order stuff: that people will stop making contracts (out of fear that they'll be parasited) or that the VoteCoin marketcap falls on expectation of future parasitism, to a level incommensurate with that required to guarantee honest voting. Fear that the VoteCoin market cap *might* fall might then contribute to a lack of trading, etc.

The Nash Equilibrium can be reached ("found") slowly, but that doesn't mean it doesn't exist. Imagine that contracts exist where the trading fees for Q1 and Q2 each net $10,000 to be divided amongst the Voters. Q3 is coming up...what might a single person decide to try? What is his cost/benefit? What is likely to happen to VoteCoin marketcap? To Voters? To Trading?

[ceci]

It has been 30 hours and 40 min since it started.
2989.83294846 BTC
513399.10038364 ETH

Anyone want to bet how much time passes until trading fees give the votecoin-holders their original investment back? $1 million is a lot of money.

Part of the problem with crowdsales is that you can sell some to yourself and inflate the "funds received" number. It's a smart idea, and someone who used to work at Augur (but no longer does) expressed an interest doing it during their crowdsale (hey, who knows).

Secondly, I still think that people don't totally understand that they can use the system for free (or that they are paying a 20% markup fee). Likely plenty of people don't care and are just wowed by the project and want to be a part of it.

The sun is setting on the current period (2014-2015), one where a recently-increased Bitcoin exchange rate (and Ethereum, given that it was originally "valued" at >$18 million for 80%) overlapped with the introduction of new projects which might, possibly, replace Bitcoin as Victorious Currency. People have a lot of (somewhat unspendable) cash, but not a lot of time/relevant-expertise.

Since ethereum allows you to make contracts that bet on augur without having to pay the fee, then the fee is like a voluntary tip. The gamblers don't have to pay if they don't want to.
Default settings are a powerful force. It is possible that a majority of traders pay the fee anyway.

Given "once a parastic contract exists, it's fate will be exactly the same as its host's", the risk-reward for both parasite and host is identical (unlike a bootleg movie where the quality may be lower). I think professional money-seeking traders are likely to consider the fee.

But the greater concern is higher-order stuff: that people will stop making contracts (out of fear that they'll be parasited) or that the VoteCoin marketcap falls on expectation of future parasitism, to a level incommensurate with that required to guarantee honest voting. Fear that the VoteCoin market cap *might* fall might then contribute to a lack of trading, etc.

The Nash Equilibrium can be reached ("found") slowly, but that doesn't mean it doesn't exist. Imagine that contracts exist where the trading fees for Q1 and Q2 each net $10,000 to be divided amongst the Voters. Q3 is coming up...what might a single person decide to try? What is his cost/benefit? What is likely to happen to VoteCoin marketcap? To Voters? To Trading?

It has been 30 hours and 40 min since it started.
2989.83294846 BTC
513399.10038364 ETH

Anyone want to bet how much time passes until trading fees give the votecoin-holders their original investment back? $1 million is a lot of money.

Part of the problem with crowdsales is that you can sell some to yourself and inflate the "funds received" number. It's a smart idea, and someone who used to work at Augur (but no longer does) expressed an interest doing it during their crowdsale (hey, who knows).

Secondly, I still think that people don't totally understand that they can use the system for free (or that they are paying a 20% markup fee). Likely plenty of people don't care and are just wowed by the project and want to be a part of it.

The sun is setting on the current period (2014-2015), one where a recently-increased Bitcoin exchange rate (and Ethereum, given that it was originally "valued" at >$18 million for 80%) overlapped with the introduction of new projects which might, possibly, replace Bitcoin as Victorious Currency. People have a lot of (somewhat unspendable) cash, but not a lot of time/relevant-expertise.

Since ethereum allows you to make contracts that bet on augur without having to pay the fee, then the fee is like a voluntary tip. The gamblers don't have to pay if they don't want to.
Default settings are a powerful force. It is possible that a majority of traders pay the fee anyway.

Given "once a parastic contract exists, it's fate will be exactly the same as its host's", the risk-reward for both parasite and host is identical (unlike a bootleg movie where the quality may be lower). I think professional money-seeking traders are likely to consider the fee.

But the greater concern is higher-order stuff: that people will stop making contracts (out of fear that they'll be parasited) or that the VoteCoin marketcap falls on expectation of future parasitism, to a level incommensurate with that required to guarantee honest voting. Fear that the VoteCoin market cap *might* fall might then contribute to a lack of trading, etc.

The Nash Equilibrium can be reached ("found") slowly, but that doesn't mean it doesn't exist. Imagine that contracts exist where the trading fees for Q1 and Q2 each net $10,000 to be divided amongst the Voters. Q3 is coming up...what might a single person decide to try? What is his cost/benefit? What is likely to happen to VoteCoin marketcap? To Voters? To Trading?

Huh?  I believe the bitcoins are multi-sig and time locked through bitgo. And why would they do that?  It would put off buyers because they get less Reputation % out of a bigger pool, thus limiting the funds they receive overall.

I'm not sure I buy into the arguements you present against augur.  Parasitic contracts can and will be done on truthcoin as well.  What's keeping someone from creating a truthcoin sidechain to bitcoin and doing the same, offering lower fees, better UXUI interface, and better funnels into the system?  Its a weakness relevant to both projects.

I do feel being built on Ethereum offers greater vulnerabilites.  But I'm not sure what they are.  I don't know exzactly how Ethereum works.  So I can't comment on the viability of such a project being down on Ethereum.  What do you think are possible technical attacks to Ethereum or Augur that could harm each systems?

[psztorc]

Huh?  I believe the bitcoins are multi-sig and time locked through bitgo. And why would they do that?  It would put off buyers because they get less Reputation % out of a bigger pool, thus limiting the funds they receive overall.

It's basic marketing that "people want something that other people want" and also that "people want what they can't have". Haven't you ever been to a club where they hold back the queue, so that it spills outside and makes it seem like everyone's trying to get in? Self-selling is easy to do via crowdsale because you own 100% of what's sold and 100% of what's bought...as long as you can sell the Rep that you eventually get at a price consistent with the eventual market cap, your expenses exactly equal the sale revenues. One can do this with a theoretically unlimited amount of money.

I'm not sure I buy into the arguements you present against augur.  Parasitic contracts can and will be done on truthcoin as well.  What's keeping someone from creating a truthcoin sidechain to bitcoin and doing the same, offering lower fees, better UXUI interface, and better funnels into the system?  Its a weakness relevant to both projects.

I don't think so. I think it is a weakness inherent to only a subset of blockchains, one such weak blockchain is Ethereum.

I do feel being built on Ethereum offers greater vulnerabilites.  But I'm not sure what they are.  I don't know exzactly how Ethereum works.  So I can't comment on the viability of such a project being down on Ethereum.  What do you think are possible technical attacks to Ethereum or Augur that could harm each systems?

Sorry, my new thing is to not give information away for free and to instead use it privately to make tons of money.

[psztorc]

Also, ceci, do you agree with me that parasite contracts are fatal to the project?

If you do, doesn't your point of view "Parasitic contracts can and will be done on truthcoin as well." require you to believe that both Augur and Truthcoin are worthless? I'm not sure how you get from there to your statement "I'm not sure I buy into the arguements you present against augur." Either you buy the argument for both or for neither, according to you.

[ceci]

Also, ceci, do you agree with me that parasite contracts are fatal to the project?

If you do, doesn't your point of view "Parasitic contracts can and will be done on truthcoin as well." require you to believe that both Augur and Truthcoin are worthless? I'm not sure how you get from there to your statement "I'm not sure I buy into the arguements you present against augur." Either you buy the argument for both or for neither, according to you.

Yes arguments apply for both.  I'm in agreement with your line of reasoning.  I was only mentioning that I'm not convinced that Ethereum is other distinct reason Augur will fail.   

I'm not sure both Augur and Truthcoin will entirely be worthless if parasitic contracts happen.  or simply they won't be making their votecoin users lots of income.   It may be just several users who own most reps and do the votecoins.  Either way, I see them existing at a small scale and will provide innovations for the bitcoin indstry in general. 

[ceci]

I can still peg information off google, why can't I steal it off Truthcoin?

I don't think so. I think it is a weakness inherent to only a subset of blockchains, one such weak blockchain is Ethereum.

[psztorc]

I agree that the form and substance of your argument that "info-pegging is not a differential" is valid. Your strategy of looking for differences among blockchains is a good one, next, I suggest that you continue by separating the blockchains into their component pieces.

[psztorc]

Planned-parasitism in the works: https://www.reddit.com/r/ethereum/comments/3ht8rx/who_will_build_a_better_prediction_market_augur/cuasel3

[janitor]

Sorry, my new thing is to not give information away for free and to instead use it privately to make tons of money.

zack said:

> Anyone want to bet how much time passes until trading fees give the votecoin-holders their original investment back? $1 million is a lot of money.

In Augur? Probably forever.
Not before Jan 1, 2017.

I had 1 BTC ready and my approach was to wait until the last day of 15% discount to see how things go. After only couple of hours I thought way too much was collected and decided to give up. If they collected < $500K I probably would have participated.
But the amount turned out to be very large and although I didn't (couldn't?) do the math I would be surprised if similar projects popped up and if REP holders wouldn't need a very long time to get their initial investment back. With cheaper REPs it would be easier (other things being equal; is there a reason to believe there will be more paying users because there are more REP holders?).

[psztorc]

With cheaper REPs it would be easier (other things being equal; is there a reason to believe there will be more paying users because there are more REP holders?).

The Augur team either did not read or did not understand what I've written about a case where one user accumulates a huge % of Rep. As a result, they believe that this state of affairs must be avoided (or else...according to them, the project is worthless?), and so they are happy with "greater decentralization" of Rep-owners. Obviously, the distribution will change (especially if someone has a reason to change it) so there's no technical reason to be interested in this. Perhaps it is just greater hype.