
Decentralized insurance using prediction markets and game theory - lamito
https://hack.ether.camp/idea/decentralized-insurance-using-prediction-markets-and-game-theory
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qwtel
I'm always worried when people want to base real-world decisions on prediction
markets.

It sounds silly, but they only work on things that are in fact predictable:

Probability of a bike being stolen: Okay.

Major conflict that kills more than 10 million people in the next 10 years:
[Might as well read tea
leaves]([https://www.edge.org/conversation/nassim_nicholas_taleb-
the-...](https://www.edge.org/conversation/nassim_nicholas_taleb-the-fourth-
quadrant-a-map-of-the-limits-of-statistics))

The problem of figuring out the probabilities in the first scenario is so
tractable that the use of a prediction market becomes almost pointless. The
only advantage the market has over a data processing algorithm (or even just
[bob]([http://intheoreum.org/#whatis)](http://intheoreum.org/#whatis\))) is
that it can react quicker to changes in the external world, say when a market
participant goes out stealing bikes...

~~~
lamalama
I agree, but not sure that these (prediction markets) are an interesting trend
to keep an eye on in the world of digital currency.

Two more that come to mind:
[http://bitcoinhivemind.com](http://bitcoinhivemind.com)
[https://www.augur.net/](https://www.augur.net/)

~~~
HairyGing3r
The Augur project is meant to be going live next week. It's already been
tested. Also its creator Joey just got a Thiel Fellowship awarded ($100k)
[http://chicagoinno.streetwise.co/2016/06/30/meet-joey-
krug-t...](http://chicagoinno.streetwise.co/2016/06/30/meet-joey-krug-the-
thiel-fellow-working-out-of-knoxville-illinois/)

