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Gnosis FAQ

Gnosis FAQ

This post will evolve constantly as new information becomes available and new questions come up. If you have a question that has not been answered here, go ahead and ask here, on our Slack, or on forum.gnosis.pm. Common questions will be added to this post.


What is Gnosis?

Gnosis.pm is a decentralized prediction market built on the Ethereum protocol. Gnosis provides an open platform for anyone to predict the outcome of any event and plans to drastically simplify the creation of customized prediction market applications. We view financial and betting applications as ripe for innovation using our open and decentralized model. Our vision is a future in which prediction markets are used to optimize an incredible range of processes and to provide a platform for information sales. Gnosis is a ConsenSys backed project and was founded by Martin Koeppelmann and Stefan George, who previously founded and built Fairlay.com, a centralized Bitcoin prediction market. Together with ConsenSys we are excellently positioned to execute on our ambitious vision.

If you'd like to learn more about gnosis and prediction markets, we have some great articles on the Gnosis blog; Martkets for the Future, and Markets for Security are a good starting point.


What is Ethereum?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.

These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middle man or counterparty risk [1].

Ethereum allows censorship resistant execution of smart contracts, which secures users as well as market makers on our platform and makes our software globally available.

[1] ^https://www.ethereum.org


What is a prediction market?

A prediction market allows users to buy and trade binary positions on the outcome of any arbitrary event. "According to most experts in economics and finance, speculative markets are exemplary info institutions. That is, active speculative markets do very well at inducing people to acquire info, share it via trades, and collect that info into consensus prices that persuade wider audiences." (Hanson 2013) As such, prediction markets provide an interesting, and potentially more accurate, oracle for the outcome of future events as well as for the reporting of the outcomes of past events.

Hanson 2013 - Futarchy: Shall We Vote on Values, But Bet on ^Beliefs?


What is the difference between Gnosis and Augur?

The two main differences are:

  1. Gnosis is a platform for prediction market applications. The goal is to make it as easy as possible for 3rd party developer to build prediction market applications which are all based on the same liquidity pool.

  2. As a platform Gnosis is oracle agnostic. We support all kind of oracles, centralized, decentralized or combinations.

Find more details in this blogpost (https://blog.gnosis.pm/the-difference-between-gnosis-and-augur-c08077271a8e#.f7pjwv2bp)


Will all markets be priced in Gnosis tokens?

No - a market creator can choose any token they like - Gnosis is currency/token agnostic. Gnosis tokens are only relevant for the fees that the Gnosis system will charge. All fees can be paid with the token the market is traded in or alternatively with WIZ. It will always be possible for an end user to use a Gnosis application without caring about Gnosis tokens.


Will Gnosis be available on other Blockchains other than Ethereum?

The Gnosis team is deeply involved in the Ethereum community. Nonetheless is our main goal to build a successful prediction market platform. Currently, Ethereum is to us very clearly the best choice to reach this goal. But we can imagine a future in 3-5 years in which a platform like Gnosis can become blockchain agnostic and operate across multiple underlying blockchains. It is also possible that this will be realised purely within Ethereum whereby different shards would be equivalent to different blockchains with different trade-offs for different parameters.


How will trading on Gnosis work?

At its core a prediction market does two things - it allows to create predictive assets (tokens that represent a specific real world even and which will have a guaranteed value of 1 unit if this outcome happens - 0 otherwise) and second the trading of those assets. Since Gnosis is an open platform those assets can be traded on any exchange (decentralized exchanges, centralised exchanges or even services like “Shapeshift”). However - predictive assets have some properties which make some market mechanisms more effective - like the use of automated market makers that guarantee to provide liquidity. Those mechanisms will be the focus of the Gnosis team but will actively contribute to making predictive assets tradable on many places. You can find a bunch of fairly technical discussion around this topic here (https://forum.gnosis.pm/c/technical).


What is the current status of Gnosis?

Gnosis is currently in early stage beta and is geared towards developers for the time being. You can find the code on our GitHub. We have three live versions right now, each with different purposes:

  • Live main-net beta: This version is live on the main-net using real ETH. It is designed to be a real-life test case for the economics of the gnosis platform.

  • Test-net beta: The test net version exists so that you can try to break things without any financial risk.

  • Uport version: Another main-net test, this one is designed to test our uPort integration.


Where can we meet the team? Starting in 2017 we are based in Berlin. We regularly attend Ethereum related conferences and meetups all over the world.


When is the token launch and where can I find more details?

We hope to be prepared for the token launch by the end of march 2017. We will make sure to have all relevant details released to the public with plenty of time for review prior to the start of the token launch.

There are already some articles explaining the mechanics of the token launch up on our blog; What are Gnosis Tokens?, Introducing the Gnosis Tokens (GNO and WIZ), and Why so complicated?.


Why are there two tokens and can you explain the difference between GNO and WIZ?

There are two separate tokens on the Gnosis platform to accomplish two separate functions. Broadly, GNO is used to incentivize long-term participation in the platform, while WIZ is used to interact with the platform.

Gnosis Wisdom (WIZ) can be used to pay platform fees on the Services layer, subsidize the fees of other participants, provide initial subsidies for markets, or for market trading. WIZ will be pegged to $1 USD worth of fees. In this way, WIZ acts as a coupon for $1 of use within Gnosis. Gnosis tokens (GNO) are the generator for Wisdom token (WIZ) creation. WIZ can only be created via activating the utility of the Gnosis (GNO) tokens. This is done via a smart contract system. The smart contract works as follows: GNO token holders agree to “lock” their tokens in a smart contract (30–365 days). A multiplier is added for longer lock durations. The smart contract determines the user selected lock duration and applies that duration to a formula that is designed to regulate the supply of WIZ tokens currently in use. Prior to locking their GNO tokens in the smart contract, users will be able to see exactly how much WIZ they will receive as a result of executing the smart contract. Once users execute the contract, 30% of their WIZ will be distributed for immediate use, and the remaining 70% will be distributed proportionally over the locked duration. Once the lock duration expires, the locked GNO ceases to generate WIZ and the GNO becomes freely transferable by the holder. There is no limit (other than duration) for how many times GNO tokens may be used to create WIZ.


How will the token launch work?

There are two great articles up on our blog post that explain the token launch in some detail; Introducing the Gnosis Token Launch and Why so complicated?.

Exactly 9 million GNO tokens will be created during the token launch, which will use a modified dutch auction mechanism. This essentially means the value of each token will start out ridiculously high and slowly get cheaper over time. Participants place a bid at the maximum value they are comfortable with and the token launch ends when one of two conditions is met; 1.5M ETH* is contributed or 9M GNO tokens are sold.

EVERYONE PAYS THE SAME PRICE! No matter when you place a bid, you will pay the same price as every other participant. For those that bid early, this means you will get more tokens for you contribution than you originally expected for your contribution.

So what happens if 1.5M* ETH is contributed before 9M GNO tokens are sold? Any excess tokens not sold during the token launch will be held by the team and used to support and grow the gnosis ecosystem.

[*] Due to the recent $/ETH price increase we will lower the cap significantly. The new cap will be announced when we announce the date for the auction.


If I bid early will I pay a higher price per token?

No - everyone will get the same price, which is the price of the lowest accepted bid.


So if I get a lower price will ETH be refunded?

No - you will just get more tokens. E.g. if you decide to buy 10 tokens and you are willing to pay up to 1ETH per token you would send 10ETH to the contract when the price function is at 1ETH per token. If the auction is sold out then finally at a price of 0.5ETH per token it will mean that you will receive 20 tokens.


What is the token for?

The core value of GNO tokens is that they will create fee credits which can be used to pay fees on Gnosis or alternatively can be used for trading in specific market. Those credits are called WIZ. You can find a detail blog post about gnosis tokens blog.gnosis.pm.


What will you do with the Ether collected in the token launch?

We are striving to fulfil our mission to source the world’s wisdom. More concretely that means that we will expand the Gnosis platform according to our roadmap. As a practical decision, we intend to hold most funds in Ether. We believe that the success of Gnosis at least in the next few years depends on the success of the Ethereum platform. In that sense, Gnosis is a bet on Ethereum. If we are taking this bet anyway it makes sense to hold Ether.


What will happen with the GNO tokens that are not sold in the auction?

The Gnosis company will retain tokens not sold in the token launch. These tokens will serve three main purposes including supporting and subsidizing applications building on top of Gnosis, reserves for potential future token launches, and long term incentivization of Gnosis employees.


What is the relationship between Gnosis and ConsenSys?

Gnosis is its own independent company but we have a strong relationship with ConsenSys. This includes ConsenSys holding equity in the Gnosis entity and vice versa, Gnosis founders and early employees will hold equity in ConsenSys. Most importantly, Gnosis will utilize many ConsenSys services, projects, connections, and other benefits. A few examples of this are the wallet and identity solution uPort, the accounting solution Balanc3 to transparently keep track of the funds, and the back-end infrastructure component Infura. Additionally, ConsenSys projects such as http://boardroom.to/ are looking into using Gnosis's Futarchy solutions.


How many tokens are there?

The total amount of GNO tokens is fixed to 10 million. The amount of WIZ is flexible and depends on platform usage. The more WIZ is used in the platform to pay the platform fee the more WIZ is generated by GNO tokens. The issuance rate of WIZ per GNO is set algorithmically. The algorithms adjusts the issuance rate to target 20 * the monthly average use of WIZ. If on average 1,000,000 WIZ are used to pay fees each month that would mean a target of 20,000,000 WIZ in total existence.

The coupling of WIZ issuance rate to its actual usage will ensure that WIZ does not inflate and will have a relative stable value. Therefore it will be possible to use WIZ in some markets as a collateral. (in plain english: users can make predictions with WIZ and not just pay the fee with WIZ)


When is the token launch?

The auction will begin on April 24th at 12pm EST.

A sale interface will go live at http://gnosis.pm prior to the sale.

More details are available at blog.gnosis.pm.

30 comments
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level 1
5 points · 1 year ago · edited 1 year ago

The reverse auction of Gnosis may have a flaw.

If the demand at $30 per token is high, $12.5 million goal could be reached by selling only 416,667 tokens while the Gnosis team keep the remaining 9,583,333 tokens (i.e. 95.8% of 10 million tokens)

So the earlier supporters would not only pay higher prices, but also take the risk of having the Gnosis team controlling most of the tokens.

Thanks to /u/Rf3csWxLwQyH1OwZhi for pointing out this problem.

level 2

the system is broken and gnosis blew their chance. It's between either delphi or augur now

level 2

Exactly! Saying that earlier supporters don't pay a higher price is only true if the ICO is not capped to $12.5M.

level 3

Agree. The only motivation to the early supporters is FOMO. Otherwise, you would rather wait until the token share of the Gnosis team reaching a reasonable level, say less than 20%.

This auction method could be fair under certain demand conditions, but could also be extremely unfair under different demand conditions.

level 2

Why would it be a bad thing if the Gnosis team is controlling a big part of the tokens? Their intentions would be to have as much participants on the prediction apps as posible, to get reliable results.

level 1

So your going to drop the required amount of ETH? Sounds like your going to do this because you want to make sure the required ETH is hit WAY before the 9 million coins are sold so you can keep most the coins for yourselves.

level 1
2 points · 1 year ago

My guess is that 1.5M ETH will be contributed in like 10 minutes, so it does matter when you place the bid :)

level 2
1 point · 1 year ago

That's a great guess.

level 1
2 points · 1 year ago

This ICO is not like other ICO's - Brilliant plan for the owners. By my estimates if they sell out in 1 Day - 95% of tokens retained by the company - Market cap $250MIL At an average price of 0.05 ETH after ~ 2 weeks they will retain ~50%+ of the tokens. - Market CAP about 25 million. To make good money on this ICO you would need to buy at .035 ETH or Lower (about $1.75) putting the Market cap at about $17.5 Million. The founders would retain 29%. This would be after 3 weeks. For the level of risk / return there are better candidates if its sold out with too high a price.

level 1

If their live platform is as complicated as their token sales, I don't have much trust in the future of Gnosis.

level 2
3 points · 1 year ago

seriously... word salad instructions

level 2
2 points · 1 year ago

hahaaa I still don't understand how their crowdsale is going to work. I think they were high. for god sake write a clean article and explain how things are going to work out.

level 1
1 point · 1 year ago

"When distributing new WIZ, the platform targets a total of 20 times the monthly usage."

At the begining there will be very few WIZZ used so on what basis will you issue WIZZ? If I lock my GNO for 1 year in day 1, can you describe how WIZZ will be created from my GNO?

level 2
Original Poster2 points · 1 year ago

Sorry /u/iikra, that information was out of date. I've updated the FAQ accordingly.

Gnosis Wisdom (WIZ) can be used to pay platform fees on the Services layer, subsidize the fees of other participants, provide initial subsidies for markets, or for market trading. WIZ will be pegged to $1 USD worth of fees. In this way, WIZ acts as a coupon for $1 of use within Gnosis.

Gnosis tokens (GNO) are the generator for Wisdom token (WIZ) creation. WIZ can only be created via activating the utility of the Gnosis (GNO) tokens. This is done via a smart contract system. The smart contract works as follows: GNO token holders agree to “lock” their tokens in a smart contract (30–365 days). A multiplier is added for longer lock durations. The smart contract determines the user selected lock duration and applies that duration to a formula that is designed to regulate the supply of WIZ tokens currently in use. Prior to locking their GNO tokens in the smart contract, users will be able to see exactly how much WIZ they will receive as a result of executing the smart contract. Once users execute the contract, 30% of their WIZ will be distributed for immediate use, and the remaining 70% will be distributed proportionally over the locked duration. Once the lock duration expires, the locked GNO ceases to generate WIZ and the GNO becomes freely transferable by the holder. There is no limit (other than duration) for how many times GNO tokens may be used to create WIZ.

level 2

There will be a minimum of WIZ to start with - even if the WIZ consumption is 0 at this point. We haven't fully decided wether this initial WIZ will just be distributed to GNO holders or if it will be necessary to lock down GNO or maybe a combination.

In any case - there will always be a current WIZ/GNO/day rate that will be adjusted (like the difficulty) continually based on WIZ consumption, total amount of WIZ and % of GNO locked down. We are currently doing some simulations and we will present the results and the exact formulas shortly.

level 1

I understand that the price will go down per block time. Can the Gnosis team tell us:

  1. What will be the starting price?

  2. How much will the price drop per block time?

I don't see any info on these questions.

level 2
Original Poster2 points · 1 year ago

This google doc has the info you're looking for: https://docs.google.com/spreadsheets/d/1vYjDat8wLd97pEfrdkzOcHd5ZLOlYjpDSkJaTnEDe1E/edit#gid=0

Will add to to the FAQ above.

level 1
1 point · 1 year ago

How does Gnosis compare to Hivemind: http://bitcoinhivemind?

level 1
1 point · 1 year ago

Hi, I still haven't gotten my GNO tokens can anyone tell me why?

level 2
Original Poster1 point · 1 year ago

They should have been credited by now, what is your address?

level 3
1 point · 1 year ago

0xcae8e17f5fe1cce24e5a63a0b6076db979821935

level 3
1 point · 1 year ago

Did you get my address?

level 4
Original Poster1 point · 1 year ago

It does not appear that the address you sent participated in the Gnosis token launch auction.

https://etherscan.io/address/0xcae8e17f5fe1cce24e5a63a0b6076db979821935

level 5
1 point · 1 year ago

That's weird it said thank you for participating and told my tokens will be available as of today. So I guess I remove my ETH from that wallet if it's not going to exchange the tokens

level 6
Original Poster1 point · 1 year ago

Very strange indeed. More then likely a result of the bid congestion in the closing minutes.

level 1

"You can find a detail blog post about or tokens here."

...where now? that word is not linked

level 1

Where and When for locking up GNO for WIZ generation?

level 2
Original Poster2 points · 1 year ago

Q4 this year according to this timeline.

level 3

Thank you, I saw that on the timeline but was not 100% sure.

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