- A Reddit post has revealed that a glitch in the Augur system has made it possible for scammers to exploit
- The scam involves creating inconsistencies in a prediction market to cause a cancellation
- Management has said that the glitch will be addressed in the next update
One advantage that the crypto community enjoys by being made up of a tech-forward crowd is that flaws and glitches will always be pointed out by the community, whether the glitch in question exists in a wallet or an entire group of networks.
This means that there is a smaller margin for error, a faster improvement time on the part of firms and more protection for users.
This was demonstrated once again in the case of Augur, when March 20, 2019, Reddit post revealed that the betting platform has a glitch that is being exploited by users to make money.
The way this scam takes place is that the user will create a prediction market and have other users bet on various outcomes, which in itself is not unusual.
Where the scam comes in is that the user uses some subtle wording in the prediction that contains inconsistencies. As a result of these inconsistencies, the market will be rendered invalid and the funds that have already been staked in which bet will be divided evenly among the users involved. In order to make the most money, the scammer will deliberately bet on an outcome that is very unlikely to happen.
An example of this was given for a prediction market called “Ethereum price at the end of March 2019?”. While the market is due to expire on March 31, 2019, the post lists the expedition period as 1:59 p.m. UTC on March 31, 2019, which is some hours earlier than the actual expiration time.
As a result of this small change, the market would be declared invalid and the funds divided. Unfortunately, the inconsistency in this case and most cases are not likely to be noticed by most site users and this means the scammer will likely be undetected.
What Happens Now?
One member of the Augur management team that has spoken out about this is Joey Krug, who is a co-founder of the Forecast Foundation and core developer at Augur.
According to him, the magnitude of the problem has been exaggerated and is likely only used by one member. He did, however, admit that the scam was evidence of a system glitch and that it would be addressed in the new Augur update.