The Unbundling of Augur

CoinGecko lists outcome tokens, TVL on the rise, Vitalik Chimes In...

Welcome to The Augur Edge, a weekly-ish dive into the future of markets, prediction, and . . . prediction markets.

I wasn’t planning to write a newsletter this weekend, but so much is happening (and about to happen) in Augur land that I was left with no choice.

Let’s plunge in.

Augur Foundry Launches

This week, AugurDAO released the first fully functional version of Augur Foundry, a UI for minting, wrapping, and settling outcome shares in Augur markets.

The Foundry tokenizes outcome shares in Augur markets into ERC20s, so they are composable and easily transferrable. Now, they can dance with the rest of DeFi.

In theory, there are endless things one could do with outcome tokens once they’re minted: throw them into an AMM pool, put them on a Layer 2 like Loopring, airdrop or gift them, broker deals, lend them, use them as collateral . . .and so on till infinity.

That said, the first use case getting traction is pooling outcome tokens on Balancer.

If you’d like to try the Foundry — at this point, it mostly makes sense for large liquidity providers — check out this quick tutorial.

Tokenized Election Shares

The first version of the Foundry features ONE market. Yes, just one. But it’s the big one. The most predicted event in the world: the U.S. presidential election.

The choice to start with one market is an attempt to concentrate liquidity and network effects and prioritize simplicity over choice.

So far, this seems to be paying off with 139k DAI of open interest created on this market via the Foundry, nearly doubling Augur’s TVL (Total Value Locked), overnight.

Augur Balancer Pool Goes Live

AugurDAO launched a Balancer pool with the election outcome tokens. It’s a three-way pool with DAI, yTrump, and nTrump.

If the market resolves YES (Trump wins the election), each yTrump token settles for one DAI, and each nTrump pays out zero. If it resolves NO, each nTrump settles for one DAI, and yTrumps pay out zero.

The Balancer pool is likely where liquidity will concentrate for now, but there is also a DAI/yTrump Uniswap pair, and there may be more pools and exchange listings soon...

CoinGecko Lists yTrump

Last night, CoinGecko listed yTrump, the tokenized YES outcome in the election market.

At any point in time, its price should reflect the market’s perceived probability of Trump winning the election.

For example, if it’s trading at .45, that signals ~45% odds of a Trump victory.

The price is based on the Balancer pool, and it will likely become more accurate and responsive in the coming weeks as liquidity and access improves.

For what it’s worth, it’s trading at .502, as of this writing.

Vitalik Chimes In

Ethereum founder and prediction market enthusiast Vitalik Buterin summed it up perfectly:

He also took the Foundry for a spin last night, minting and wrapping shares, and shared some useful input. Thanks Vitalik!

It says a lot about a project when its founder takes time out of a Friday night to tinker with a new app created by some randos in the ecosystem and openly shares his feedback. It’s no surprise that Ethereum has such a flourishing community with this kind of founding ethos.

That will do it for this edition of The Augur Edge. There are some exciting things on the horizon…so stay tuned!

Have a great rest of the weekend and happy Predicting,

Ben

p.s. longtime readers may notice the new format, as I’ve (finally) switched over to Substack. I’ll forever be thankful to Mailchimp for helping me get going with online newsletters. I used it for just over two years, and it’s a great tool. That said, I find both the writer and reader UX far smoother on Substack.