- Augur published the second version of its betting platform on Tuesday.
- The project was one of Ethereum’s first in 2015 with Angel investments from Vitalik Buterin.
- Its v2 adds a number of new crypto tools including IPFS, Dai from MakerDAO, 0x Mesh, and Uniswap’s award oracles.
The ultimate in decentralized finance (DeFi) Lego has arrived: Augur version 2, which was released on July 28, according to the Forecast Foundation.
“The Augur v2 protocol contracts were successfully deployed on the Ethereum Mainnet. The contracts were checked on Etherscan and the address of the deployer can be found here“, It says in the blog.
Augur was originally launched in 2015 and was one of the first Initial Coin Offerings (ICO) and Ethereum apps to garner notable attention for its blockchain betting market. And now v2 has all the bells and whistles of the DeFi market today, including the Interplanetary File System (IPFS), 0x Mesh, MakerDAO’s dai, and Uniswap’s v2 Oracle network.
The first version, despite its well-known presence in the crypto community, was notoriously clunky, slow, and generally unusable. Originally, Augur was loosely based on Yale statistician Paul Sztorc’s Truthcoin, a predictive protocol based on the Bitcoin blockchain. (Sztorc has no connection to the project, according to a blog from 2015).
A second version had been in the works since the project’s early days, according to two of its founders, Jack Peterson and Joey Krug.
“The first version of Augur is likely to be a little slow and a little expensive (think pennies and lots of seconds per trade), but it will certainly be a nice glimpse into what’s to come.” wrote the team in a 2017 Medium article.
And just like Eth 2.0 faced unseen delays, Augur v2. However, with all that time, the team has been able to add a slew of Ethereum projects to its betting platform.
To the races
Augur is an oracle. Oracles bring off-chain data into the chain.
While this second sentence is only seven words long, it is far more difficult to implement than summarize. The main difference is that on-chain data is objective while off-chain data is subjective.
When you send a Bitcoin transaction, press a button and the network will record it. Nothing much to deny. Off-chain data, on the other hand, is the world of CNN, Fox News and Facebook wine mothers. We don’t know what the truth is – we just have “reports” of what happened.
At its core, Augur (and his predecessor Truthcoin) try to do this through fancy tokenomics: to turn real events into betting events on blockchains. This is also what Oracle networks like Chainlink and Band Protocol are trying to do.
Read more: Crypto Decentralization In 12 Markets Can Actually Improve
To do this successfully, systems must encourage users not to misreport information and also to agree on an interpretation of an event. Whether this is even possible remains questionable.
Augur has three different bet types: a yes / no market, a categorical market with up to eight choices, and a scalar market between zero and 100, said Tom Kysar, director of operations at Augurs Forecast Foundation, in an interview with CoinDesk.
In the past, Augur v1 has allowed certain markets to be declared “void” when the outcome of an event could not be properly diagnosed, but it resulted in many bets being negated.
Augur v2 will expand on this logic by allowing players to bet on an additional option for all markets: void. An invalid market bet option helps to demonstrate with money that the better off think the bet was poorly constructed, Kysar said.
“‘Invalid’ [becomes] an explicitly tradable result on the market, ”said Kysar.
Another advantage of v2 over v1 is the billing cycle. Markets on the first iteration of Augur took seven days to close. Now it has been cut to 48 to 72 hours, assuming a market isn’t competitive, Kysar said.
Augur is serverless, according to a blog posted on Monday. No, Augur doesn’t go beyond modern computing – a byte has to be hosted somewhere. However, Augur has integrated the Interplanetary File Systems (IPFS) for decentralized client storage.
“Using IPFS means that the absence of a single party can stop client distribution and there is evidence of changes in code to what is openly available on GitHub,” the blog said.
Kysar said Augur will also release its software for replication in other Web 3.0 projects such as the Ethereum Name Service (ENS).
Date, date, date
Augur v2 is also data heavy – which isn’t good for the current Ethereum mainchain, which is currently seeing historical demand. But it makes it smoother for users.
In Ethereum, decentralized applications (dapps) are hosted on so-called smart contracts. Smart contracts execute actions if they are paid for in the native currency of the blockchain, ether (ETH).
However, not all contracts are created equal. Augur requires these contracts to contain a lot of data, sometimes referred to as “bloated”. Data-heavy contracts put a strain on the network.
Lately, Ethereum developers have been concerned about the growth of the Ethereum state, which contains some of the data for conducting transactions. According to the team’s admission, Augur will only add to the current Ethereum state in one major problem for the base layer:
The Augur V2 contracts tend to store more user-relevant data than many other similar contracts. For example, profit and loss data and market metadata are stored in the chain. While this means that transactions become a little more expensive, it allows applications like the Augur V2 client to make fewer network inquiries and to retrieve relevant data immediately.
The heaviness of the data means higher fee rates for the average Augur user. Kysar said his napkin math showed a successful bet on Augur for double the cost of gas compared to a token swap on Uniswap. However, opening a new market on Augur cost about half the cost of opening a balancer pool.
Augur starts up without an admin key, unlike some other dapps that have received a lot of criticism in the past.
Continue reading: Ethereum developers delay Berlin hard fork to curb customer centralization concerns
Admin keys provide back doors to on-chain contracts to make adjustments for live projects. Several Ethereum projects have been asked to allow developers to keep these keys after the project has started or without disclosing the information. For example, Tornado Cash’s v1 admin keys were only verifiably destroyed after a contract update v2 in May.
Augur’s token, REP, is also undergoing some sort of facelift, Kysar told CoinDesk. REPv2 introduces new logic that was not the case with the previous token.
Augur raised $ 5.3 million for his Reputation (REP) token under the auspices of the Forecast Foundation at the ICO in August 2015, according to Messari. REP, an ERC-20-style token, is the platform’s quasi-governance token “used for reporting and contesting the outcomes of events,” says Messari.
Kysar said the old REP token cannot work with the new v2 contract, which means a new token had to be produced. The Forecast Foundation has issued instructions for replacing the new REP with the old one, which “will eventually need to migrate to REP v2 after Augur v2 is deployed,” according to another Augur blog.
Augur is one of the first dapps to integrate 0x Mesh, an on-chain relay order book system that can be used for betting. (That’s a lot; here’s a breakdown.)
Source: 0x Mesh / Reddit
On-chain refers to the way 0x set up its order book: it pings the main Ethereum network when a transaction needs to be executed, as opposed to off-chain order books which bundle pings. Each side has perks that are not worth addressing here (although off-chain order books have been gaining popularity recently due to the cost of gas).
Relayers speed up transactions over the Ethereum blockchain, which is known to be slow and inefficient.
This inefficiency is a feature of the way blockchains are arranged: as peer-to-peer (P2P) connections. If you are thinking of making a trade or a bet, you probably want it to be done quickly, which does not work well on a network that whispers transactions, instead of executing them straight from the dealer to the order book.
Relayers form a cluster of nodes that allow transactions (the bets) to speak to order books more quickly.
“0x jobs are simply cryptographic messages that can be passed on, such as: B. forwarded, “0x spokesman Matt Taylor told CoinDesk in an email.
Augur now has a stable betting medium, the USD-Wert-Mimicker-Dai. Augur has traditionally used Ether, but as CoinDesk reported in October 2018, a Dai integration has been in the works for a long time.
Why? ETH price volatility is bad for betting. For example, ETH started at around $ 230 in July and has shot up over $ 320 in the past few days. A long term betting platform can’t use a native entity like Ether and expect people to stay around. Imagine wagering on a choice only to see the USD value of your bet go up or down in hindsight.
Not to mention that a decentralized stablecoin is a godsend for any betting log with questionable legal language. Veil, a betting platform built on Augur, was shut down in July 2019 due to regulatory concerns – concerns that a decentralized stablecoin would help suffocate.
“We weren’t decentralized or regulated. Some users want a fully decentralized, unstoppable product and others want a regulated product. It’s hard to offer something in between that people find valuable, ”Veil wrote at the time.
And to top it off, Augur will be using Uniswap as a price oracle service. All decentralized applications must receive prices through a feed like a Bloomberg terminal. This is a function that Ethereum “Geld Lego” Uniswap can offer.
Uniswap is an automated market maker (AMM), meaning it combines tokens for trading and listing in a decentralized way, just using the underlying logic of the application itself. If someone wants to list a token like the new REPv2, they pay a fee and drops the token on the log. Anyone can buy the new token or create token “pools” with trading pairs on Uniswap.
For example, you could set up a DAI / REP trading pair to buy REP with DAI or vice versa.
“There is a huge demand for oracles and having a price feed in the chain, especially a decentralized one, is a very valuable thing,” Uniswap founder Hayden Adams told CoinDesk when Uniswap v2 was launched. “This is a service that Uniswap v2 provides to the world and I think it will indirectly benefit the Uniswap protocol.”
These pools create information for trading, especially price data. In theory, you can rely on a highly liquid pool to provide a good base price for the token compared to another token such as ETH. So you can find out the price of the REP token based on how many ETH you can snag from a pool for it.