A few days ago, Vitalik tweeted about a quirky (though not altogether unexpected) naming collision in the prediction market space:

We were not aware of Delphy.org prior to encountering this tweet, but since we now are, it makes sense to take a moment to respectfully acknowledge their presence and approach, at least to give an idea of how our respective projects differ, since we have already done the same for both Gnosis and Augur.

What We Like

First, we are quite intrigued and impressed with Delphy’s decision to focus on the mobile experience. This is very creative, and it seems like it might really represent added value over what Gnosis and Augur are bringing to the table. A fluid mobile interface could go a long way towards achieving mass adoption, so we respect that Delphy are emphasizing this component so strongly. In fact, they have prompted many internal discussions at Delphi.Markets regarding our own mobile strategy moving forward.

Second, we can see that Delphy were inspired by the shortcomings of Gnosis and Augur from §2.7 of their whitepaper, just as we were. This means that they, too, represent post-Gnosis prediction market technology.

Third, Delphy clearly have excellent taste when it comes to naming a project which revolves around prediction markets and oracles.

Aside from the above, there are also many commonalities between the various different prediction market approaches in the ecosystem (e.g. data structure types, market scoring rules, and token standards), so while there are plenty of other aspects of Delphy’s design that deserve praise, most of the compliments we would like to give also apply equally well to the other relevant projects (including our own). Like we’ve said before, it is the differences between projects that are really interesting, so let’s discuss these now.

The Differences

From what we can tell, the most profound difference between the approach being taken by Delphy.org versus the approach being taken by us (Delphi.Markets) is that in their model, their organization is much more “hands-on” in the protocol than our own model would allow. Their whitepaper includes clauses such as the following:

§3.1.5:

“If the Oracle associated with the Market cannot decide the outcome, or users dispute the correct outcome, Delphy will provide a variety of ways to resolve the dispute.”

§3.1.2:

“The system also has an Event Filter which is used to filter out illegal or unethical events, such as predictions on the assassination of a country’s leader or the overthrow of a government.”

We wouldn’t be comfortable with having that level of control/power over the Delphi protocol, and we do not feel that we have any authority to decide what events or outcomes should be considered “unethical” (or even what jurisdictions’ laws are relevant in determining legality), so we will not provide any mechanisms for central intervention or filtration in the protocol like Delphy do.

We must also admit that we were disappointed to see how brief of a treatment their whitepaper gave to The Oracle Problem (just two short paragraphs in §4.3), which we consider to be the most important component to any prediction market effort. We have dedicated a lot of thought to this problem, and are looking forward to releasing more details about our Pythia approach for oracle inputs in the very near future. Stay tuned for more information on this front.

Finally, although Delphy do take the time to acknowledge legal and government-related risks, they do not seem to be taking extreme precautions to mitigate the severity of such risks, as we are. Whether this is a true competitive advantage is in the eye of the beholder, of course.

Competition is Good

It is important to remember that a diverse and competitive ecosystem is a good thing. The team at Delphy.org have recognized the vast potential of blockchain-backed prediction markets, and are making a rational decision to enter the space as a result. The fact that we have reached the same conclusion on this is actually encouraging. It indicates that we are both likely onto something.

The universe grows via natural selection, and we are not afraid of some healthy competition. Over time, different approaches will be tried by different teams and organizations, and eventually, the best ideas (or at least those ideas that were best executed) will rise to the top. As Delphy themselves explain:

“Delphy’s underlying protocol is based on an open-source computer software such that nobody claims copyright or any other type of intellectual property right of the source code. As a result, anyone can legally copy, replicate, reproduce, engineer, modify, upgrade, improve, recode, reprogram or otherwise utilize the source code and/or underlying protocol of Delphy in an attempt to develop a competing protocol, software, system or virtual platform or virtual machine, which is out of the Delphy Foundation’s control and may consequently compete with or even overshadow or overtake Delphy. Besides, there have been and will be various competing blockchain-based platforms that compete with Delphy. The Delphy Foundation will in no case be capable of eliminating, preventing, restricting or minimizing such competing efforts that aim to contest with or overtake Delphy.”

These are wise words, and we completely agree.