The phrase “the prediction markets” describes platforms such as GnosisDAO that forecast cryptocurrency prices to give traders and investors some returns. But how do they work?
Let’s see!
Defining the Prediction Market
How Does It Work?
Types of Prediction Markets
GnosisDAO
How It Is Different from Other Prediction Market
How to Have GNO/OWL and Start Operating on Gnosis Prediction Market
How to Buy GNO From an Exchange
General Thoughts
Table of Contents
Defining the Prediction Market
It refers to a company of people that speculate on different events such as commodity prices, exchange averages, results of quarterly sales, etc.
How Does It Work?
It is based on contracts that depend on a future event and its outcome. Take the presidential elections, for instance; it is possible to structure future contracts to pay $1 if an outcome becomes true. But it doesn’t pay anything if the outcome doesn’t materialize.
So, if you pay for a contract supporting an outcome that materializes, you’ll get $1 in return for that contract. It is possible for the price to rise when many people start to buy.
Types of Prediction Markets
There are two main types:
Centralized Prediction Market
This is affected by three factors that are known as the 3 Cs of centralization. The three factors are costly, constrained, and closed. Together, they restrict the utility that is present within prediction markets. They also affect the ability to take in information and give forecasts accurately.
Decentralized Prediction Market
They are entities without owners and don’t have centralized operators.
GnosisDAO
This platform is created by Gnosis and uses a very different governance model. The GnosisDAO allows their users to vote on the development and administration on the platform. One of its major selling points is how it integrates with the Gnosis prediction market.
How It Is Different From Other Prediction Markets
- It is created on ETH protocol which makes the platform open so that people can predict the result of a plan and also simplifies the process of creating apps for the prediction market.
- It focuses on third-party operations and tries to make things easy for third-party developers so that they can develop prediction market apps with a liquidity pool as the basis.
- It is built for prediction market apps, and it supports different oracles, combinations, decentralized, or centralized.
How to Have GNO/OWL and Start Operating on Gnosis Prediction Market
The first thing to do is to buy the GNO token which allows you to purchase OWL as well. If you want to buy GNO, you can do that at a crypto exchange. It can be purchased with fiat currencies or exchanged with other cryptocurrencies such as Bitcoin.
How to Buy GNO From an Exchange
- Choose the currency: Go to the You Send field, and choose BTC, and put the number of coins in it. Then select GNO in the You Get field. This will automatically calculate the amount of GNO that you get, then click exchange.
- Enter wallet address: Put your GNO address in the Destination address. Also, fill in the sender address with your BTC address in case of a refund.
- Wait for deposit: Send the BTC to the Deposit address.
- Commit exchange: The exchange will be finished within a few minutes.
Also, you may check the Bitcoin prediction market to determine if it’s a good decision to exchange your BTC.
General Thoughts
Prediction markets are useful tools for prognosis because they represent different opinions. Blockchain technology has also made it possible to have ownerless, peer-to-peer predictions. Gnosis is one of such markets. It also has its token, which you can buy on Godex exchange.
