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Comment by claywm | Hacker News Reader

Take note, daily fantasy sports sites:

> “We’ve learned from our own experience,” [Intrade founder Ron Bernstein] replied, “that regulatory avoidance isn’t a good business model.”

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A couple of decentralized prediction markets[1][2] powered by blockchain technology are trying to move regulatory compliance from centralized betting exchanges to the users themselves, which could be construed as an attempt to minimize regulatory liability, similar to DMCA Safe Harbor provisions.

[1] http://www.truthcoin.info/

[2] http://www.augur.net/

I wonder how these companies/groups will prevent minors from betting? Even countries where gambling is fully legal frown upon underage gambling. I think these startups are not going to be able to dodge all the regulatory problems by pushing the betting onto a blockchain.

They aren't startups, not any more than "Bitcoin" or "Bittorrent" are startups.

Once the software is initially developed and released, there's no head to cut off or assets to seize, there's just a million little pseudo-anonymous players scattered all over the world.

Augur raised millions of dollars through crowd funding. There's definitely a central organisation there.

Seizing the money raised in the distribution of the reputation isn't going to shut down Augur any more than seizing Satoshi's house and putting him in prison would shut down Bitcoin. At a certain point (Augur and Ethereum aren't there yet) it just takes on a life of its own beyond its creators.

I mean, Bittorrent ostensibly had a "central organization" at one point but there's nothing you could do to it that would shut down the protocol.

I take your point, and I don't expect any legal action against Augur until (if?) it grows big, by which time it will have less of an obvious core. But there will still be identifiable promoters, e.g. anyone hosting a website advertising/facilitating Augur. I'd guess that these people would be the ones at risk, rather than the individual bettors.

Anyway, I'm watching its development with interest, but I suspect that it won't become a big success.

I'm a little confused by augur. It can only predict things well based on a large crowd of people betting on it? So the more specific or niche the event, the less chances it will be correct?

The correctness should be taken care of by the bettable event, ideally carefully considered by the market maker. If the event is not believed to be easily verifiable, you probably should avoid betting on it.

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