Flux Has Arrived: Why The Time For Open Prediction Markets Starts Now
Flux is an Open-Market Protocol that has been in the works for the last 18 months. As the first project to launch on the NEAR Blockchain, there are a number of unique advantages of the Flux platform as a truly decentralized, user-friendly, scalable, and secure protocol for the future of open markets, decentralized finance, and data-driven applications.
Flux is Launching: We Hope You Are Ready.
What is Flux? Understanding in Context
Flux challenges existing prediction markets, while also pioneering the future of decentralized finance (DeFi). On Flux, an ecosystem of stakeholders maintains the creation, resolution, disputation, and conclusion of data-based marketplaces connected to events and people in the real world. As a decentralized protocol, Flux offers any individual, developer, enterprise, and entrepreneur the unique opportunity of building a decentralized application, opening up a new prediction market, trading on existing prediction markets, or participating as a validator in resolving market outcomes in exchange for rewards.
There are two separate trends that Flux launches on the forefront of:
(1) The continued rise and existing dominance of internet-based prediction markets.
(2) The Emergence of Decentralized Finance in the Cryptocurrency Industry and Superforcasting as a Profession.
Internet Based Prediction Markets:
Internet based prediction markets, also known as ‘decision markets’ refer to online platforms from which any individual can set a price on the realization of a future event. Extensive in scope, these markets encompass well-known recreational activities - from sports betting, to predicting the next viral meme - to more advanced predictions from economists and macro traders on future events including black swans, pandemics, revolutions, and military events. As Slate explains, even DARPA has been interested in the development of these markets for national security purposes:
“That’s why the Defense Advanced Research Projects Agency has been funding so much research on the topic, hoping that prediction markets can assist military planners.”
For the average user or trader, a prediction market is an opportunity to make a profit off of the behavior of an event or asset. Today, the Total Addressable Market (TAM) for prediction markets is valued at close to $12.3 TRILLION Dollars. The primary verticals for Prediction Markets include:
Betting: With a value close to $53.7 billion dollars.
E-Sports: With a value close to $14 billion dollars and rising.
Global Futures Markets: Estimated value of $12.1 Trillion across a multitude of Assets.
Social Markets: With a value close to $43 Billion dollars.
Sports Markets: With an addressable value of roughly $104 billion dollars.
To date, these markets are highly centralized: Gatekeepers, in the form of exchanges, online betting platforms, or applications have complete control over what markets are offered to users as well as which bets can be made. These same centralized platforms also have the capacity to charge transaction rates for each bet, at a price of their choosing.
Emerging Markets: DeFi and Superforcasting
While existing prediction markets are highly popular, two of the most notable emerging trends in both fintech and decision markets include Decentralized Finance (DeFi) as well as Superforcasting. Both are important contextual markers for understanding the full potential of Flux.
The Rise of Decentralized Finance (DeFi):
Decentralized finance, as written by Forbes’ Jeff Kauflin refers to “the notion that crypto entrepreneurs can recreate traditional financial instruments in a decentralized architecture, outside of companies’ and governments’ control.” In its current form, DeFi plays are primarily built around marketplaces for decentralized lending, assets, exchanges, and derivatives.
For Flux, assets and derivatives are especially relevant: As Defirate writes, the traditionally centralized markets for these products are some of the largest markets in the world (in the Trillions of dollars for derivatives), while the decentralized replica’s remain extremely underdeveloped and small:
“The traditional derivatives space is absolutely massive. We’re talking hundreds of trillions or even quadrillions of dollars in market size. DeFi-based derivatives are nowhere near this size and given the potential size in the existing market, there is a substantial amount of room for this sector to grow. As such, derivatives from projects such as Synthetix and Augur have only aggregated $49M in TVL as of writing in September 2019.”
As such, the potential market that Flux intends to disrupt is perfectly positioned for innovation.
Less well known, yet still increasingly relevant, is a more analytical and professional niche of decision markets known as ‘Superforcasting’. Pioneered by Dr. Philip Tetlock from the University of Pennsylvania. In essence, what companies like The Good Judgement Project demonstrate, is that there is also professional interest - from large corporations, to government agencies like DARPA, in the usage and monitoring of decision marketplaces. These practices, largely based on probability and statistics, is an emerging industry for policymakers, entrepreneurs, and military organizations.
The Flux Revolution:
In the early days of prediction markets, Flux is positioned as an all-encompassing, decentralized platform, at the forefront of both existing and emerging prediction marketplaces. From E-Sports Betting, to Superforcasting black swan events, to using the Flux Platform for decentralized insurance applications, there is no doubt that Flux is building the future of open markets.
Importantly, there are a number of additional features that Flux incorporates that make it entrenched for the long term:
Flux is building on NEAR Protocol. Flux is the first project launching in the NEAR Ecosystem. That is important for a couple of reasons: Flux is going to be supported by the NEAR Foundation and the community at NEAR. NEAR is debatably one of the most robust blockchain ecosystems to date, in large part due to Nightshade and dynamic sharding. In addition, the NEAR ← → ETH Rainbow bridge recently launched, meaning assets, data, and cross-chain calls can be integrated into Flux from Ethereum.
Flux is Launching With A Selection of Live Products and Tools: The Flux SDK, the Flux App, and the Flux Oracle, are all essential components that help the ecosystem hit the ground running. Additional tooling and incentives, including the Flux Automated Market Mirror, as well as Flux Mechanics, the Flux Beta Program and Flux Liquidity Incentives all provide structure and easy access to prospective developers and liquidity providers. In short: The platform can run at full speed upon launch.
dApps are Already Building on Flux: To date, 10 teams are already building the future of prediction markets on Flux. While the details of each project will be released in time, it is known that these projects range from E-Sports Betting, to Prediction Exchanges, to News Derivatives, to Social Sports Betting. In essence, a small flow of early adopters ahead of the trillions of dollars looking for cheap and accessible markets in the future! As a beginning, the experiences and success of these teams, will largely affect the speed of development upon the platform.
No Competitor is Remotely Comparable To Flux: Across the three most important criteria for any open market, Flux dominates the competition: The Flux platform can handle between 100 - 80,000 transactions per second, with a minimum resolution time of 30 minutes, and cost per transaction of less than $0.01 cent.
The Time To Get Involved in Flux is Now:
Flux is in its early stages of development. Interested developers, entrepreneurs, and validators can begin their journey with Flux Protocol by Signing Up for the Flux Social Incentives Program. As markets mature, and the decentralized web continues to grow, there is little doubt that Flux will remain on the cutting edge of decision markets and the innovative applications built therein.
About 4NTS: 4NTS Guild is a rising NEAR Guild focused on connecting and communicating NEAR, its different projects, and the tremendous opportunity for entrepreneurs, contributors and other Guilds. Feel free to drop us a line at info@4NTS.com