The prediction market is getting a facelift through the power of technology by PlotX. The platform was conceived by former Nexus Mutual and GovBlocks developers, and is akin to Ethereum-based Uniswap, except for prediction markets.
Built on the Ethereum network, PlotX allows users to interact over predictions that span anywhere from one hour, one day, and one week. For example, users can answer a question like, “What will the price of BTC/USDT be in the next 1 hour?” The correct users would earn peer-to-peer (P2P) rewards.
To date, this game-changing software offers users predictions for events occurring within a week. The company launched on the Ethereum Kovan Testnet on August 4, and already over 131 users have placed market predictions using the PlotX dApp. The offerings and users will undoubtedly increase when the platform goes live on the mainnet this September.
By combining the in-built fun and intensity of prediction markets with the decentralized power of blockchain on the Ethereum network, PlotX has created a formula that solves the complexities that have left the industry hamstrung.
Growing market trend
The prediction market has continued to grow in popularity throughout the world. Users enjoy trying to predict a whole host of future events, and rewards can often be sizable.
For example, the internet is rife with prediction sites allowing gamblers to choose the future winner of the US Presidential election. For a fee, users can bet on their favorite candidate, and potentially win big when upsets occur.
Pay to play and bias
The problem, of course, is that these sites are centralized, for-profit companies. For that reason, predictions come at a sizable cost—sometimes as high as 20% of winnings.
Unless a prediction is a massive win of an underdog, these kinds of playing fees can often wipe out any potential profit. Even the best predictors can find themselves narrowly in the positive after all the fees are paid to the company.
The other issue is, of course, the danger of bias because of the centralized system. For example, a user interested in predicting the outcome of the POTUS election could be swayed to sell a position because of faulty reporting.
Fixing issues through tech
The answer to these types of problems is elimination. In order to eliminate prohibitive costs and bias, the need is to remove the centralized governance, while still maintaining the necessary security.
PlotX is able to overcome both of these complexities through decentralization. By decentralizing the prediction platform, payments are isolated to the P2P level. This is effectively the equivalent of a schoolyard bet between friends. Fees are effectively reduced to zero, and users keep winnings or pay losses to one another.
PlotX has the added bonus of a P2P system that provides a non-biased platform. Users make predictions and the odds are determined by the platform, rather than the centralized third party.
As technology continues to improve, frontrunners like PlotX will need to continue to innovate. However, by solving the primary issues that face users, the company appears poised to disrupt the market at large.