UK Prime Minister Boris Johnson has put his premiership on the line pledging to deliver Brexit—Britain’s departure from the EU—by October 31. Bettors on decentralized prediction market Augur have put around $10,000 on the line saying he won’t—with a mere five percent of them putting money on it happening.
Augur’s prediction market, “Will The UK Leave The European Union Before November 1st 2019?” was created just over a month ago; so far, some $60,000 worth of ether has swapped hands on that market, with $9,738 staked. But only five percent of those bettors expect Brexit to happen by Boris Johnson’s October 31 deadline.
Augur is an unregulated, online gambling platform that enables betting on anything. It also has a remarkable history of accuracy: bettors rightly predicted that the Democrats would sweep the House in the 2018 midterms, and that Kavanaugh would have his nomination to the Supreme Court confirmed. A decentralized collective of “reporters” judges the outcomes.
On Augur, bettors either buy or sell shares in a given outcome—rather like going long or shorting a stock. The percentage who have bought shares—implying they believe it will happen—make up the percentage "for" the outcome. So in this case, five percent of bettors on the Johnson market bought, rather than sold, shares in the prime minister’s success.
Augur depends for its accuracy on the theory of the “wisdom of crowds.” When large groups of people bet money on future events, they think harder than when they answer a simple poll, and—the theory goes—can tap into collective pools of understanding that lone analysts can’t.
Augur has a solid track record; almost every other recent major bet has proven its worth. Beyond Trump and Kavanaugh, bettors in the past month correctly guessed that the price of Bitcoin would be above $4,000 on October 22, and that Justin Trudeau would emerge victorious from his nevertheless hotly contested premiership race. Just 4 percent of bettors believe Trump will snag a Nobel Peace Prize by the end of his first term in office.
Get ready for Brexit?
For months now, Boris Johnson has been struggling to make Brexit happen. Since taking office as Prime Minister, Johnson has pledged October 31 as the day Britain will irrevocably cut ties with the European Union, but his plans have stalled in the face of misfortune, legal conventions and even his own MPs.
Johnson has deselected MPs who defied him, costing his party its majority. He attempted to prorogue (suspend) parliament to push orders through without debate: both the House Speaker, and the UK Supreme Court, shut him own. He tried to get his MPs to hold a vote of no confidence in his own government to trigger an election, and failed. He floated a similar “withdrawal deal” to the Theresa May-led deal he had previously scorned. His latest effort to make good on his word was roundly rejected by parliament.
It’s perhaps unsurprising that Augur bettors are giving the Prime Minister short shrift—but then, Johnson’s built his career on defying expectations.