Numerai Opens Crypto-Powered Stock Betting Market to the Public

Hedge fund Numerai has just officially launched Erasure - its crypto-based data gathering and stock price prediction marketplace.

Allowing experts earn or lose funds by staking them on stock market price predictions, the Erasure protocol has been active since June 2017, when Numerai distributed its "Numeraire" tokens to data scientists, said founder Richard Craib.

Now, the company is now looking to attract hedge funds worldwide by allowing anyone to buy a prediction.

Built on the ethereum blockchain, Erasure works by allowing members to essentially bet on their predictions.

If the prediction comes true, the user wins the staked tokens.

Now, by allowing public access, data scientists can sell their predictions to other hedge funds by providing proof that their predictions are accurate using historical data on the Erasure marketplace.

"[Now], it's not just Numerai but every financial institution in the world, every hedge fund in the world can look at this and say 'all these people are submitting predictions.

While, previously, a hedge fund might have to take a scientist's word on trust alone, users can now point to immutable data to indicate that they have been correct in their predictions a given percent of the time.

As Craib pointed out, if a data scientist does sell a prediction which winds up being incorrect, the hedge fund can destroy the user's stake, limiting the fund's risk and amplifying the user's.

While historical data is publicly accessible, new predictions are hidden from the public - the only way to see it is to purchase the prediction.