Decentralized prediction markets are already taking advantage of the global nature of the blockchain space! While the ecosystem is becoming more robust, there are teams hard at work on applying blockchain technology to the areas that they are the most interested in. Xiahong Lin, the Project Lead and Founder of Bodhi, gave an interview about how he assembled a strong development team with the goal of connecting real-world events to a smart contract in a truly decentralized way.
Greetings, Bodhi team! It’s quite a rare occasion for us to communicate with projects of oriental origins. So what do you think about how cultural differences may affect the project’s goals and structure?
Bodhi was originally intended to target the Chinese market in order to create its own prediction market platform, as most of the team members are Chinese. China needs its own prediction market platform due to the differences in language, culture, and business.
People in China are interested in different events. For example, the US political election events have historically been very popular, but this topic would not be appealing for most users in China.
Also, many people in China do not speak English, and so they click away from a non-Chinese site.
If we build a platform for the Chinese audience, we will be a part of that ecosystem, and it will become likelier that other Chinese projects will work with us.
That is also why we have chosen a name that was inspired from Asian origins: Bodhi – the revelation of truth.
Mr. Lin, could you tell us about your experience with conventional prediction markets? What could be considered to be an impulse for the Bodhi project to begin?
Traditional prediction markets have been around for a very long time, and we believe that the decentralization of prediction markets have several advantages.
The blockchain enables us to use smart contracts to facilitate a prediction market to anyone with a wallet. This further enables the trustless, peer-to-peer conditional transfers of value using the blockchain. Although blockchain technology has its limitations, the prediction market use case fits very well within these limitations.
Long block time – the speed of a transaction is limited in a blockchain system, which could take up to up several minutes to confirm. But prediction markets are typically on the scale of a few days or a few weeks. So, confirmation time is not critical.
Small block size – scalability and ever higher transactions-per-second (TPS) have been highlighted as one of the main limitations for blockchain technology, but because each prediction event is simple, it can work without difficulty on even the most current technologies.
Low computational power – the blockchains’ and Ethereum’s virtual machine is impressive in what they can do, but they still have difficulty processing large computations; and this becomes very expensive to perform on Ethereum. The Bodhi smart contract is a relatively simple contract, and we are constantly monitoring and optimizing our gas usage, so we are able to make the most of the blockchain’s capability to run the platform.
As we all know, the white paper is usually considered as something akin to promotional materials. However, in your case, it adopts the clean and precise style of academic papers. Is this some kind of marketing approach, or you consider it to be of use for academic purposes?
It’s not at the level of an academic paper, but we wanted to make it simple enough to explain the core concepts. Prediction markets are not extremely complicated at first glance, but this can become the core mechanism to build much more complicated systems. We allude to this in the paper, but do not go into all of the future possibilities in detail.
It’s stated that you will not handle exchange functions for BOT as well as declaring to not expect any revenues or privileges out of it (out of usage in Bodhi). This sounds a bit different as opposed to everyone trying to present as many possibilities for revenue as possible. What is your idea behind this?
Bodhi’s token (BOT) is a utility token that is necessary to run the distributed peer-to-peer style of governance that is core to Bodhi’s platform. Without this token, we are unable to prevent attacks on the system, and people can overwhelm the system if they are rich enough. BOT prevents such negative things from happening.
Your team has a very active social media presence. And it’s rare to see you without your colleagues from the QTUM team. What kind of connections do you have?
Thanks for saying that, but I think we actually have not done a very great job in marketing. We have a decent social media presence in terms of our Medium blog, our Twitter, and our Telegram group, but we are always looking to improve and to engage with our community in better ways. By the way, we are currently seeking help in this area, so if any of your readers are great with social media and community management, please visit bodhi.network/careers.
While we are still discussing QTUM, there is a peculiar article with a NEO/QTUM platform comparison. It says that QTUM-based projects are mostly Western-oriented ones, while it seems that most of your team come from the other side of the globe. Did you have some issues to overcome in this matter, and who is your target audience?
We did not have any issues with QTUM in working on “Western” projects. Projects in the blockchain space are usually global in nature because its potential user base is anyone that has access to that blockchain. Although we initially targeted a Chinese audience, we have since expanded to a much broader scope of users. We have users from all over the world.
Your decentralized review mechanism is indeed a great idea, but aren’t you afraid that the community might not realize it’s utility in the short run, hindering its functionality and giving rise to unfair acts? Or is it something that those “early stage arbitration” tokens are for?
Thanks for the praise about our Replaceable Oracle Mechanism! This is the crown jewel of Bodhi’s architecture. We believe this is the first truly decentralized way to connect real world events to a smart contract and have it unanimously agreed upon by the network. We are proud of how this is achieved with the Bodhi platform, using both game theory and token economic incentive models.
By the way, congratulations on your production version release. May we ask you to make a short resume of Bodhi’s achievements during the last year?
Our team has been amazing, and we were able to launch everything on time. Our mainnet release was actually two months ahead of schedule. We’ve been told that this is impressive considering that Bodhi was able to go from inception to a mainnet release in just under one year, whereas other projects have taken several years and are much further behind.
There are a lot of risk-averse statements in the white paper of your project. Just how risky can a blockchain enterprise be? Could you share some of the difficulties that you overcame or evaded this year?
There are several uncertainties in the blockchain space. Some related to the blockchain as a whole, some related to the US, and others related to prediction markets. Bodhi always does its best to understand and comply with all applicable laws. We have several teams of attorneys, and legal advisors guiding us in our decisions. I’d prefer to let our attorneys discuss the legal challenges they faced, and how they overcame them.
We’ve recently heard about your ongoing Ethereum integration. This system with the BOE (Bodhi On Ethereum) token sounds complicated. So BOT is going out of use? It’s kind of rare for a project to change the token it’s based on. It makes your project sound really flexible. What other elements could be easily replaced?
This is a common misconception, and I’d like to take this opportunity to set the record straight. BOT is not going out of use; BOT will always remain the primary token that is used on the Bodhi platform. For technical reasons, we decided that the easiest way to implement Bodhi across multiple chains was to implement separate smart contracts on the different blockchains, and to tie them together at the user interface level. We explored many alternatives, and decided in the end that this was the best way to proceed. In order to facilitate the Ethereum side of the Bodhi platform, we needed to create a new token that’s native to Ethereum; this became known as the Bodhi-On-Ethereum (BOE) token.
Ever since the white paper, we had plans to expand to multiple blockchains, and Ethereum made sense after launching on the QTUM mainnet.
There is a lot of talk around the real-life application for prediction markets, and decentralization makes those ideas skyrocket. Not so long ago there was an ongoing discussion in terms of the connection between prediction markets and insurance. Do we have some real cases right now? Do you perhaps have some secret projects up your sleeve?
We welcome anyone who wants to contribute and build third-party applications on Bodhi’s platform, and we will provide developer tools, like SDK and Library, in the future as well. Insurance is a pretty straightforward use case for the prediction market mechanism, as are the others on our site (financial prediction, simple sports outcome prediction, value discovery, etc.).
Even though most of the receivers present tokens of decentralized prediction markets to be fairly equal, there is a major capitalization gap between those. Is this market that competitive? Also, why is it so that prediction market projects cover less than 1% of total market capitalization?
Although prediction markets are a great use case, there are also many other use cases for blockchain technology beyond prediction markets alone. This is a great sign that the ecosystem is becoming more robust, and that many people are working on applying blockchain technology to the areas that they are the most interested in.
Following the previous question, we’d like to ask about the unity that most of the teams in this industry show. Even though your projects are quite similar and that competition seems to be to be inevitable, there a lot of photos on social media of these teams happily attending conferences together. Is this truly all this friendly or is some healthy rivalry present?
We believe that it is too early in the blockchain’s life cycle to be overly concerned with labeling projects as competitors. If we can work together to make our projects better as whole, we are happy to partner up. If we have overlap on the areas we cover or the problems we solve, we are also happy to work together to be more effective.
During this year’s Consensus 2018 in New York City, Bodhi hosted a prediction market panel, and invited every prediction market at the conference to attend. We had a great panel with several prediction markets, and projects using predictive systems; Stox, Cindicator, Delphy, and BlitzPredict joined us for the panel, and the full unabridged version can be seen on our Youtube Channel.
Among other uses for decentralized prediction markets, the unification of conventional prediction markets was also discussed. How far are we from that goal? What advantages does Bodhi have? And how long of a process is it going to be?
We are not focused on those things as a metric of success. We will continue doing what we feel has the most value, and if that ends up affecting conventional prediction markets, great! Bodhi is the first to launch on the QTUM testnet, the first to launch on the QTUM mainnet, and the first project we know of to attempt operating on multiple blockchains simultaneously.
We have many advantages; a strong developer team, supportive community members, and a deep understanding of the blockchain space. This can be seen by our accomplishments, and it shows more than whatever I can say to you right now.
Mr. Lin, could you advise our readers on some literature or web resources that you find to be valuable?
First of all, I think they should enhance their understanding of prediction markets by reading Prediction Markets, by Justin Wolfers and Eric Zitzewitz. This piece would allow them to construct a general understanding of conventional prediction markets and some specifics of the industry.
They may also rewind some math statistic studies in practice by reading Interpreting Prediction Market Prices as Probabilities, written by the same authors.
The case of scientific prediction markets could be studied in PREDICTION MARKETS FOR PROMOTING THE PROGRESS OF SCIENCE AND THE USEFUL ARTS, by Tom W. Bell. Robin Hanson’s The Informed Press Favored the Policy Analysis Market could broaden your knowledge as well.
To generalize, it’s better to gain some basis for understanding of conventional prediction markets before moving on to more complicated cases of today.