Messages

I feel like letting people have open buy/sell orders at a specific prices solves the same problem.

For instance, if B in a market was only 1 coin, and I put 100 coins at the price 0.56
Then I would keep buying shares until it cost more than 0.56 for a share, then I stop buying. The remainder of my 100 coins is ready to buy more, if anyone else should ever push the price below 0.56

I don't like changing beta, because I think it pushes the price towards 0.50? Maybe I am wrong about this problem?

Another reason I don't like branching...
I think that a prediction market should be able to use decisions from multiple juries. (from multiple branches.)

If one jury handles who is president, and a different jury handles predicting the future tax rate, a market should be able to combine decisions from those two juries.

I didn't like the old branching idea. It is no good to copy everyone's coins.

I think it is best if juries have a fee for creation. Maybe 10,000 votecoins are created when you make a jury, and 1,000 truthcoins are destroyed.
Each jury has distinguishable votecoins, which are spendable like normal.

Example of somone's account in database: {'address':982378h9yf92f3, 'truthcoins:1000, 'shares':[[8093jf8304jf443fj849, 1, 100], [984320ue383294832, 0, [7823u9jd8328, 1, 1000]]], votecoins:[9824y89324r8932, 10000]]}

they have 1000 truthcoins, and they can win 100 coins in market 8093jf8304jf443fj849 on yes.
They bet 1000 into a market, and it also had a sub-market for that coin. so if you are correct on both bets, you will win 1000 coins.
You bet no in 984320ue383294832 and yes in 7823u9jd8328.

Finally, you own 1000 vote coins in jury 9824y89324r8932

Yeah, I am pretty bad with nomenclature.
If we can get some defined terms somewhere, I will try to stick to them.

http://blog.oddhead.com/2006/10/30/implementing-hansons-market-maker/

I have been using this explanation of LMSR.

If there were 5 possibilities, then the initial investment is B*ln(5) and the cost function=B*ln(e^(x_1/B)+e^(x_2/b)+...+e^(x_5/b))

For example, if we had a token which says "This token is worth 1 truthcoin is BTC/USD is between 600 and 630 tomorrow".

You could use that token as input for a market which sells these 2 types of tokens:
1) "This token is worth 1 truthcoin is BTC/USD is between 600 and 615 tomorrow"
2) "This token is worth 1 truthcoin is BTC/USD is between 615 and 630 tomorrow"

Every market's token possibility must be mutually exclusive. The sum of the token possibilities is the input possibility.

######## edit
This very popular thread has a lot of links in it that point to unmaintained code.
My efforts to build truthcoin are happening here now: https://github.com/BumblebeeBat/FlyingFox

I used what I learned from slasher when I built FlyingFox. slasher was a prototype.
########

https://github.com/zack-bitcoin/slasher

I made this small cryptocurrency specifically for building things like truthcoin out of it. It is a pure POS currency like blackcoin, but does not use any bitcoin code. It is all python that I wrote.

New transaction types can be quickly added by editing the transactions.py file.
I am trying to figure out all the transactions for implementing truthcoin, here is what I have so far:

1) create a jury.
Creates some money. The holders of this money collectively vote on decisions. If they vote well, the money grows, if they vote bad, it shrinks. Juries might specialize for topic. Maybe one group of jurors only does basketball games, another deals with politics, etc. They can all have different fees as well.

2) offer a decision to the jury.
Decisions have text explaining "Obama will win the presidential election" and a date that it expires, like 2 weeks after the election. When it expires, the jury comes to consensus about the outcome.

3) jury votes to accept a decision, or to reject it.
Juries don't want to deal with vague sounding decisions that are hard to decide on. They don't want to have to drive far, or waste much time learning something new.

4) juries vote on the outcome of a decision after it expires.

5) anyone can create a new prediction market.
(in ethereum speak, a prediction market is a type of "contract")
The prediction market depends on a bunch of undecided decisions that juries have agreed to.
The PM sells at least 2 types of tokens, one type will eventually be declared a winner, and it will be worth 1 truthcoin. all the other types go to zero.
Each PM only accepts one type of money. Either truthcoins, or one type of token.

6) anyone can buy tokens from any prediction market.

7) anyone can sell tokens to the prediction market they purchased it from.
*not always true. The author of a PM can choose to disallow this feature. disallowing the selling of tokens is useful in the case of funding public goods.

the ability to spend truthcoins, to spend the tokens that you buy from PMs, and to spend the juror money.

Does this seem like sufficient transaction types for the entire truthcoin? or am I missing something?

I really appreciated your intro to prediction markets. It woke me up to the possibilities very quickly.

The second page where you show how to find correlations in different predictions, that blew my mind.

I think we should have an exchange, and put a MASSIVE sell order with all the coins.
As people buy them, we use the bitcoin they give us to put a buy order at 0.99* the sell order.

Everyone can easily convert back and forth, just by paying a 1% fee.
It is backed by bitcoin, and they have to trust the centralized organization to uphold this promise.
Eventually, truthcoin community outgrows the centralized institution. All the coins are purchased.
Then the price of truthcoin floats freely against bitcoin, and the centralized institution stops existing,
the investors keeping all the bitcoins as profit.

The centralized institution needs to decide on it's total profits from day one. 1,000 bitcoins? 10,000 bitcoins?

If you aim too high, a different centralized institution could undercut.
If you are too low, then your community wont be big enough to have stable truthcoin/bitcoin exchange rate.