Numeraire: a token for intellectuals
Numeraire is not a typical crypto project. This innovative type of hedge fund allows crypto experts to create machine learning models and provide predictions to improve capital management.
The little-known NMR token suddenly joined the top ten cryptocurrencies with the highest growth rate in a week. It showed a 38% price increase over 7 days. In a bear market, such a coin’s behavior can indicate both a successful Pump & Dump scheme and the fact that we are dealing with a new asset that is gaining popularity due to its unique features.
Let’s try to figure out who would be interested in the NMR token of the Numeraire project.
Who founded Numeraire
First, let's clarify the meaning of the word “numeraire”. It refers to a basic standard for measuring prices. This term is used in mathematical economics.
The project was founded by the crypto exchange Coinbase and investment management company Renaissance Technologies, with the support of the American venture capital firm Union Square Ventures.
The investors include London-based AI venture capital group Playfair Capital, and Naval Ravikant, co-founder of AngelList and the largest investor in Uber.
The famous South African mathematician Richard Craib came up with the idea for Numeraire. When asked by a journalist about the project's ambitions, he replied, “I want to manage all the money in the world.”
The project advisory board includes:
- leading physicists of chaos theory;
- machine learning experts;
- specialists in probability theory.
This set of experts demonstrates that big whales and institutions invested in the launch of Numeraire. It shows their interest in the capabilities of AI in processing market data and financial forecasts. And the project's driving force is not famous people, but experienced mathematicians. According to the project's official website, it is positioned as a social network with hedge fund software.
The Numeraire platform is deployed on the Ethereum blockchain and uses smart contracts.
How does the Numeraire network work?
The Numerai platform operates as an artificial intelligence aggregation model, called a “meta model”. The AI processes all the predictions it receives from participants in the application’s network.
The AI then creates a possible price movement model and an optimal algorithm, so the hedge fund can trade equities in the stock market based on this model. Numeraire also allows its users to use their personal models in relation to an approved set of financial products (there are about 5,000 of them).
Information is collected through the so-called Numerai Tournament, a weekly competition where data collection and processing specialists upload trading algorithms. Users submit their predictions through the betting engine to participate in the tournament. Artificial intelligence then analyzes the received information and assesses its accuracy.
An internal Numerai Signals app was created to receive pre-made signals from users. Participants can use it to upload their stock market signals for a chance to win NMR tokens. However, no predictions are accepted by Numerai Signals. The application shall be filed in a brief format with just a stock ticker and a number.
What do you need NMR tokens?
NMR is a platform’s utility token. Every week, token holders can stake them for the right to participate in the Numerai Tournament. Participants can get lots of NMR tokens for a strategy that AI deems to be optimal.
However, you first need to earn tokens by correctly predicting the stock price in order to upload the trading model for the competition.
Every accurate signal in the Numerai Signals app is rewarded with a small amount of NMR. Every false signal leads to the burning of tokens on the participant's account.
Also, the initial supply of Numeraire is capped at 21 million tokens, which must be distributed among the participants according to their score in the tournament table.
The Numeraire network uses the so-called “Proof-of-Intelligence” or PoI algorithm. It is a unique consensus architecture based on Artificial Intelligence. It combines AI computing resources with a community of experts. However, instead of the typical transactions, the system examines the content metadata to see whether the calculated forecast matches the actual situation.
You can buy or exchange the NMR token on the following exchanges:
- Coinbase
- Binance
- Bittrex
- Kraken
- OKX
- KuCoin
- Poloniex
Such a list of large centralized crypto platforms gives us a hint that the NMR token is worth watching closely. The token is functional, has practical value, and is in high demand among the members of the “Club of Soothsayers”. The project is backed by reputable companies, so it can hardly be profitable for anyone if the token goes down the dumper. And artificial pumping has no chance of going unnoticed.
To be fair, it's important to point out that NMR is not a good investment unless you plan to compete in the Numerai Tournament battle of wits.
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