So, you know how decentralized technologies are making it possible to do things that were completely impossible before? Like creating uncensorable information storage and retrieval networks or circumventing the gun laws of the would-be tyrants?

Well, how about if it could also allow you to bet on anything? And I mean anything.

Doesn't sound so amazing? Well, what if we're not talking about placing a bet on the outcome of the next Super Bowl, but the time and location of the next terror attack? Or the likelihood of the President of the United States being assassinated?

Most of us understand that betting on such things is deeply irresponsible and unethical. After all, if a gambling market creates a financial reward for those who predict an event, then it also provides an incentive to make that event happen, no matter how horrific. Why just commit a political assassination when you can also profit from that assassination?

Well, guess what? You don't have to wait for this hypothetical prediction market to be created. It already has. It's called Augur, and it's currently running on the Ethereum network.

Augur bills itself as a "prediction market protocol owned and operated by the people that use it," meaning that it is a place where users can create a market to buy and sell shares based on the outcome of any given event. Want to bet where Amazon is going to place its next headquarters? Just create a market and place your bet. When the decision is announced, the market is resolved and those holding shares of the winning outcome (Nashville, say) are paid out from the market contract.

So far so non-revolutionary, right? After all, prediction markets have existed before. Ireland-based Intrade, for example, was a popular online market where people placed bets on everything from the outcome of US political elections to the outcome of the Academy Awards . . . until it was shut down by US federal regulators in 2012. Apparently, the site was also allowing people to bet on commodity prices without jumping through the proper CFTC hoops and Uncle Sam swooped in to put an end to that. At the time, the director of the CFTC's Enforcement Division warned that "We will intervene in the 'prediction' markets, wherever they may be based, when their US activities violate the Commodity Exchange Act or the CFTC's regulations."

This type of regulatory intrusion has made it difficult for prediction markets to really thrive, even in the wild west of the internet. As Ian Edwards notes in his Medium.com post on the subject:

"Most governments see online prediction markets as either gambling or options trading and heavily regulate them. As a result, today they are only available in certain jurisdictions with limited types of events. Some of the largest commercial ones are Betfair, BETDAQ, and Smarkets, which are primarily used for sports betting, horse racing and other forms of gambling. Prediction markets affiliated with universities, such as the Iowa Electronic Markets or PredictIt, generally focus on political events. Most exchanges earn revenue by charging fees that are calculated as a percentage of net winnings for each customer on each event.