Blockchain Revolution



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Blockchain Revolution

Prediction Markets
The company Augur is using the blockchain to aggregate many small wagers about
future events into powerful predictive models. With the right application, it could help
create collaborative democracy. Governments could use prediction markets to engage
citizens in helping better understand future scenarios, enabling governments to make
better policy choices.
Ethereum’s Vitalik Buterin discusses an alternative model of political life called
futarchy.
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Conceived by economist Robin Hanson, its tenets can be neatly
summarized as “vote for values, but bet on beliefs.” Citizens elect their democratic


representatives in a two-stage process: First, pick some metric to determine their
country’s success (like literacy or unemployment rate). Then, use prediction markets
to select government policies designed to optimize the elected metric.
Augur’s style of prediction making could engage citizens in making small choices
that contribute to national discussions of policy, eventually shaping the future of their
own democracy.

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