Augur’s New Blockchain Betting App Has Already Changed Gambling Forever

Augur’s New Blockchain Betting App Has Already Changed Gambling Forever

“Everyone can bet on anything, everyone can create a bet on anything – and since the technology is entirely decentralised, no-one can do too much about it.” That, in a nutshell, is the Augur platform as explained by one commentator in one online discussion forum: based on blockchain technology, it is the world’s first entirely autonomous betting platform.

To be able to participate in the Augur’s betting markets, you need to download the entire Ethereum blockchain which will set you back about 90GB in hard memory at the time of writing – a figure which will increase over time so you may want to think about purchasing a separate hard drive to install the app.

The platform is, as per its blog, entirely decentralised – there is “no hosted or centrally served deployment of the Augur reference user interface or Augur Node that connects to the Augur protocols contracts on the main Ethereum network.

There are a number of Augur-related websites. But here, whilst you can participate in markets, you cannot create them. So if you want to join in with the action completely, there is no getting around the fact that you will have to manage your own Ethereum node.

Legal Concerns

One concern, however, is that Augur, barely one month after its release on the back of a development map for a project that was three years in the making, is already making headlines – for the wrong reasons. The platform  serves as a mechanism for Americans to participate in online betting markets – anonymously – when such activity is largely illegal in the US.

However, whilst the idea that blockchain technology may be hailing in a new libertarian economic order is not exactly news, what may be more likely now to attract the unwanted attention of the US federal authorities are the assassination markets that have emerged on the platform.

Bets are already being exchanged in favour of successful assassinations of figures such as Donald Trump and Warren Buffet, according to Mike Orcutt, associate editor over at MIT Technology Review. And whilst these markets appear to have relatively low participation at the time of writing, they do nonetheless represent a dangerous precedent.

The reason is simple – when individuals create rewards for certain outcomes, there is a natural incentive for participants to ensure that outcomes align with their own interests. Which means that Augur may metamorphose from a betting marketplace to one in which participants earn rewards for ensuring that prophecies become self-fulfilling.

Whilst traditional betting marketplaces like online horse racing operator Unibet have been exposed to similar issues in recent times, they do, on the other hand, have to respect the laws of the land to keep their licences – hence we don’t see Unibet or William Hill suggesting their own assassination markets.

On a decentralised dapp which cannot be taken down and which offers anonymity, the whole dynamic has changed however. It is not beyond the realms of possibility for Augur – or a platform like it – to simply become a de-facto assassination orderbook in all but name.

There is, however, perhaps a simple remedy. Augur itself leverages witnesses who report on the outcomes of given markets. With a simple upgrade, the developers could, for instance, offer the ability for witnesses to simply request a “null and void” on a market itself. And working from the assumption that the majority of witnesses will generally act against “repulsive markets”, then the debate may just go back to the more innocent subject of the pros and cons of a truly libertarian economic order.

Of course, as this is all open-source, this doesn’t prevent others from going off and re-introducing a platform that does not curate its betting markets. Pandora’s Box has been well and truly opened…