The Dark World of Cryptocurrency 'Assassination Markets'
Technology continues to develop in a dark direction with an app recently launched by the nonprofit Forecast Foundation. The Augur protocol allows users to create decentralized prediction markets where people can bet cryptocurrency on the outcomes of a variety of questions.
This past week users were able to bid on whether or not President Trump would be assassinated in July 2018, raising questions about whether such "assassination markets" could lead to actual assassination attempts.
And Trump is not alone. People are also betting on the deaths of Sen. John McCain, who's battling brain cancer; Amazon CEO Jeff Bezos; and actress Betty White, who has been the subject of a number of death hoaxes over the years.
Most of the markets have very few (if any) shares traded. In fact, nobody actually bet on Trump's assassination.
But it's likely that activity will increase as more people become aware of the platform. A market currently running shows shares traded in the millions.
Augur utilizes a distributed blockchain, a shared global digital ledger system used to securely record transactions, move value around, and represent property ownership. Augur describes itself as "a set of smart contracts" that can be deployed to the Ethereum blockchain, a decentralized platform that runs applications that run exactly as programmed, "without any possibility of downtime, censorship, fraud or third-party interference."
That infrastructure enables developers to create markets, store registries of debts or promises, move funds, and a number of other things, "all without a middleman or counterparty risk."
The Augur app allows people to predict just about anything, completely free from regulations or censorship. Current categories on the site include crypto, weather, agriculture, politics, sports, climate, medicine, finance, and a number of other topics.
One market predicts President Trump's chances of being impeached:
Under the Politics, USA category, you will find this market:
Market creators at Augur are charged a fee, payable in Etherium cryptocurrency. In order to help creators recoup their fees, they're allowed to charge a "creator fee" of up to 50 percent. Augur, not surprisingly, also gets a cut via "Reporting Fees" and "Settlement Fees," which are calculated using an off-Augur price feed.
Dan Robitzski explains at Futurism, Augur itself is not a prediction market, "it is a protocol for cryptocurrency users to create their own prediction markets."
The assassination prediction markets are particularly troubling. "All a would-be assassin has to do is stake a whole bunch of money on 'yes' and they’d make a fortune," Robitzski says.
"Via a distributed blockchain ledger, people could predict anything from political elections to the weather, and do so totally free of censorship from any regulatory body," he said. "That also makes it a great place for unethical bets — like those that predict whether a celebrity or politician will die this year."
"These bets give people a chance to make money in seedy (or illegal) ways," Robitzski adds. "For instance, someone could have an accomplice predict that a particular public figure will live to see 2019, or find an existing bet where most people think the person will survive. Then, that person could make sure they win by killing the person."
According to Elaine Ou at Bloomberg, "An assassination market differs from traditional murder-for-hire in that unlimited wagers can be made against a potential target."
"The greater the odds stacked against a person’s death, the larger the incentive for a prospective assassin to take the opposite side and execute the outcome," she explains. Ou notes that such markets are not new. "In 1995, crypto-anarchist Jim Bell designed a system he called 'Assassination Politics,' a prediction market where participants could anonymously contribute digital cash to bounty funds designated for the death of government officials."
Augur's website warns that users "must themselves ensure that the actions they are performing are compliant with the laws in all applicable jurisdictions," adding that users do so "at their own risk."
The organization states in its FAQs that it takes no responsibility for the actions of its users. "The Forecast Foundation has no role in the operation of markets created on Augur, nor does it have the ability to censor, restrict, control, modify, change, revoke, terminate or make any changes to markets created on the Augur protocol."
Blockchain technology promises to change the way we do nearly everything, disrupting a variety of industries, including healthcare, real estate, banking, education, and even politics. While blockchain holds enormous promise for solving problems and improving our lives, it also has a dark side that could potentially put human lives at risk. The unregulated nature of the technology leaves it wide open for abuse and has the potential to create great harm. It remains to be seen whether or not, on balance, we'll be better off if blockchain's promises do actually materialize.
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