Numeraire (NMR), founded in 2017 as the native cryptocurrency for the Numerai blockchain project, is a decentralized hedge fund platform using artificial intelligence and crowd-sourced predictions to create an optimal investment strategy. It was designed to revolutionize the hedge fund model using blockchain technology, crowdsourced AI estimations in data science, and much more.
On the Ethereum blockchain, NMR rewards data scientists around the world for modeling and making predictions, hence building a decentralized network of collective intelligence. The NMR token plays an important role on this platform for staking by data scientists in order for them to make predictions and get paid based on performance.
Numeraire was founded by Richard Craib, founder of Numerai. He is a data scientist and entrepreneur. Craib envisioned Numerai as a platform to decentralize finance and create a collaborative ecosystem for quantitative predictions. The Numerai Community relies heavily on its global network of data scientists, who contribute models and compete to optimize Numerai’s hedge fund strategies. His mission is to create the world’s first crowd-sourced hedge fund by uniting AI, blockchain, and decentralized finance.
Numeraire integrates blockchain technology, machine learning, and financial markets into one decentralized ecosystem. The Numerai Tournament is a weekly competition where data scientists make predictions on various financial datasets. Contestants stake NMR tokens on their predictions and compete for rewards based on their accuracy.
Numerai operates on the Erasure Protocol, allowing participants to stake, submit, and manage predictions in a non-custodial manner. Data scientists stake NMR tokens to signal their confidence in their predictions; correct predictions are rewarded, while the stake of incorrect predictions is burned.
NMR is an ERC-20 token intended for staking, governance, and incentivization within the Numerai ecosystem. Automated smart contracts manage stakes, rewards, and token burns, ensuring trustless and transparent interactions.
Numeraire lives on Ethereum, with Layer-2 integrations like Polygon and Arbitrum to further boost scalability and throughput, reaching considerably higher transactions per second (TPS) compared to Ethereum’s base capacity of 15-30 TPS. With Arbitrum it achieves up to 40,000 transactions per second (TPS), while Polygon supports up to 65,000 transactions per second (TPS).
Numerai has formed several strategic partnerships to strengthen its infrastructure and expand its capabilities. AWS serves as Numerai’s cloud infrastructure provider, ensuring scalability and reliability for data processing and AI model deployment. The integration with Polygon addresses scalability challenges, enabling faster and cheaper transactions for both stake and reward distributions.
Collaboration with AI leaders like OpenAI helps refine Numerai’s prediction models, enhancing the performance of its hedge fund strategies. NMR is listed on major DeFi protocols such as Uniswap, Aave, and Balancer, increasing its utility as a collateral asset within decentralized finance.
Recent developments include the expansion of the Erasure Protocol’s functionality to new use cases in secure staking and data submission, beyond its original use at Numerai. Numerai introduced model performance analytics to help data scientists deeply evaluate and optimize their models, driving greater engagement and competitiveness within the community.
The Numerai platform has seen phenomenal growth in its user base, with data scientists from more than 50 countries contributing predictions. Numerai is exploring cross-chain compatibility to integrate with other blockchain networks, increasing accessibility for global users and improving scalability.
Numerai is also working on sustainability initiatives to reduce the carbon footprint of its operations, aligning with global efforts to make blockchain technologies more environmentally friendly. To encourage innovation, Numeraire has initiated grant programs for developers to build applications and tools that extend the value of NMR tokens and the Erasure Protocol.
As of December 20, 2024, the native token of Numeraire, NMR, changes hands at approximately $16.70, up 4.18% in the last 24 hours. With a market capitalization of $2127 million, the cryptocurrency is leading among blockchain-powered data science and decentralized hedge fund platforms.
Numeraire reached its all-time high (ATH) of $168.48 on June 25, 2017, and its all-time low (ATL) of $1.92 on November 26, 2018. Factors influencing price movements include increasing participation in Numerai’s tournaments, which drives demand for NMR tokens. Integration with DeFi platforms boosts NMR’s liquidity and utility in decentralized finance. Scalability enhancements, such as Layer-2 solutions like Polygon, reduce costs and attract more users to the platform.
The Numeraire token stands at the crossroads of decentralized finance and data science, combining blockchain and AI to optimize financial markets. With its novel staking mechanism, strategic partnerships, and ever-growing community, Numerai is the leading agent of change in how data is used to build investment strategies. This creates a global network of data scientists who come together to develop and integrate applications with DeFi and Layer-2 solutions, opening up ways toward a more decentralized, data-driven future of finance.
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FAQs
Q1. What is Numeraire used for?
- A: NMR is used for staking predictions, rewards, and governance in the Numerai ecosystem.
Q2. How does Numeraire ensure the accuracy of the predictions?
- A: Data scientists stake the NMR token on their predictions to signal confidence. Wrong predictions can be subject to token burns to foster high-quality submissions.
Q3. What is so special about Numeraire?
- A: The Numeraire is a Hedge Fund that integrates AI, Blockchain, and crowd-sourced predictions with unique insights into Big Data.
Q4. What is the Erasure Protocol?
- A: Erasure is an open protocol to stake manage and submit data securely, which Numerai uses in order to make predictions.