Predictions are a powerful thing. Ask Macbeth — the three witches were able to really mess with him in their forecasts about his future.
But classical Shakespearean works aside, predictions become all the more powerful when you create markets around them. Doing so creates a mini economy based on people’s convictions about future events, which can in turn be used to gain insight and gauge popular sentiment.
We now have prediction markets built on the blockchain and have markets that cater specifically to cryptocurrency loyalists. Here’s a look at some of those platforms and how you can use them to make better cryptocurrency trading decisions.
ZeroSum is a platform for skill-based peer-vs-peer competitions built on the Ethereum blockchain. While currently focused on the cryptocurrency and Forex prediction markets, it is evolving into the creation of prediction competitions of any kind, so long as there is a reliable data feed based on which participants can be judged. For example, you could create a contest to see who can forecast the weather most accurately over the course of a week the best or predict the volume of traffic along a specific route on a day.
Since there are live feeds for the prices of various cryptocurrencies, ZeroSum is the perfect platform for the creation of prediction markets around their prices. It already hosts competitions in which participants can make money by predicting the movements of bitcoin. That money is paid out in the form of ZFX, the platform’s native Ethereum token.
ZeroSum gives people a great way to familiarize themselves with the crazy world of cryptocurrency without investing in it. It can allow novices and experienced traders alike to test, experiment and learn about the strategies they are looking to use in the real market. Participants simply make price predictions, by doing which they learn to see patterns that cause crests and waves in the value of bitcoin and altcoins. They make money in the process, so it’s a great entry point or testing ground overall.
Augur was among the first to draw the connection between prediction markets and the blockchain. The platform is decentralized thanks to its Ethereum underpinnings, leading to a more easily accessible, accurate environment for such an application.
Augur’s participants can make prediction on all sorts of outcomes — everything from when Avril Lavigne’s new album is going to be released to whether the Golden State Warriors will win the NBA again in 2018. You express your confidence in the odds for a particular outcome by buying shares that represent it. You then earn money either if the outcome you predicted came true or by selling your shares at a higher price then you bought them.
Augur is a great way for cryptocurrency novices to make an entry into the Ethereum ecosystem. While it doesn’t currently support cryptocurrency prediction markets, novices are able to use cryptocurrency like Ethereum to engage with other users on the platform. Augur also serves as a fun introduction to trading in general, by allowing people to buy shares in outcomes that matter to them.
KoCurrency is a price prediction platform for cryptocurrencies. What sets it apart is that it lays a very strong emphasis on data-drive investment advice. The way it generates this investment advice is through a combination of technology and the results the members of its community are able to generate.
KoCurrency’s participants engage in various transactions on the platform using a token called KoCoin. They start by using KoCoins to enter various channels, which are places where you can make predictions and engage in discussions around different specific cyptocurrencies. Once they’ve entered a channel, members can earn KoCoins through successful participation in different price prediction competitions.
The platform makes use of data from its community to create intelligence on the future prices of cryptocurrencies. This is done by studying the patterns of the most successful traders on the platform, by using a model that is able to separate valuable signals from noise. Along with making this crowdsourced investment advice available, KoCurrency also creates educational content to help people early in their cryptocurrency trading careers.
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