Psychic Finance is an interesting cryptocurrency project that runs on the Binance Smart Chain and combines the benefits of NFTs, DeFi Yield Farming, and a predictions market place that rewards users for correctly predicting real world events. It's a lot of different features all rolled into one, and it's a project that is early in its development. So, in this post, I'd like to share what Psychic Finance is and some of the benefits it offers.
Before we start the article, I want to be 100% clear that Psychic Finance is a project that is still under development and that a lot of the features should be considered forward looking. Especially with a project that isn't fully developed and has a lot of features that are "Coming Soon", it is especially important to DYOR.
With that being said, I think Psychic Finance has an interesting value proposition: users can create prediction polls and earn crypto rewards for correctly predicting real world events. All of this is done in a decentralized way that also uses NFTs to assign roles within the ecosystem.
The predictive marketplace is exactly what it sounds like. Users can create a proposal and then other users make their predictions by simply voting "Yes" or "No" on a proposal. Users that correctly predict the event are rewarded whereas users that incorrectly predict the event loose the PSY tokens that they used to bet on the prediction. This system serves two purposes. First, it can be thought of a fun wagering game for the participants that bet the crypto. Second, creators of the predictions have easy access to gauge popular opinion on real world issues.
Requiring users to "put up" PSY tokens serves two functions. On the one hand, requiring users to use PSY tokens ensures that users have a vested interest in researching the proposal and trying to make an informed prediction instead of just spam voting on predictions they know nothing about. On the other hand, requiring users to wager also serves as a way of self funding the rewards mechanism that gives PSY to the prediction winners.
How Does It Work?
Although the actual voting and prediction process seems straightforward, there are some interesting steps that the team is implementing to ensure that the system is fair, efficient, and decentralized. One of the things I like most about the predictive marketplace on Psychic Finance is that creating prediction proposals follows a logical process that is both decentralized but also moderated to ensure (hopefully) high quality, relevant predictions.
In order to create a proposal, users must first hold either an administrator or creator NFT card. This ensures that users must make a small initial investment in order to begin creating proposals which drives demand for the underlying NFTs.
After a proposal is created, it goes through a decentralized approval process that ensures the proposal is well vetted while also preventing the heavy-handed censorship inherent with traditional gatekeeping methods. In order be listed on the prediction marketplace, the proposal must receive a minimum of 20 upvotes within a 24 hour period and be approved by three judges. Further, proposals that are rejected receive a penalty which dis-incentivizes spamming proposals.
Once a proposal has been voted on and the time period has expired, a user who holds a referee NFT will provide a verdict on the prediction and certify the results by linking to a reputable news article, photo, or other credible documentation. In the event that there is some disagreement over the referee's verdict, an appeal is possible. In the event of an appeal, a new referee will upload results and three different referees will certify the new results and either confirm or overturn the initial decision.
After the results are certified, rewards are distributed among the correct voters according to an algorithm. This algorithm considers a variety of factors, but does give preference to votes cast earlier in the polling period as well as to voters who hold higher rarity cards.
NFT Marketplace + Farming
What I like most about Psychic Finance is that the roles in the ecosystem are defined not by admin privileges but by NFTs that enable users to transfer rights and responsibilities using all of the advantages of blockchain technology. The use of NFTs to determine roles in the ecosystem means that there is an inherent demand for the NFTs which should be good for the value of the NFTs, but it also means that each of the players in the ecosystem has to make an initial investment to participate which will hopefully encourage them to maximize the value on that investment by making good predictions.
Within the ecosystem, it is also possible to farm the PSY token in a variety of pools including BUSD, BNB, and CAKE. As this is a very new project, yields are currently very high. This offers the potential for HUGE profit but should also be approached with a great amount of caution simply due to how new the project is.
Once again, I want to re-iterate that this is a VERY new project and that a lot of features currently exist only on paper. I do like what I see with the project, and I think that the concept of using NFTs to define roles and institute a decentralized predictions marketplace is absolutely phenomenal. That being said, it is easy to draft a "game changing, earth shattering, revolutionary, paradigm shifting" whitepaper, but it is quite another thing to transform that whitepaper into a functional product. It is incredibly important to realize that even the best designed whitepaper needs a dedicated team to put it into practice and bring to fruition. Although I do like the concept of the project, I think its important to temper that optimism with the realization that a lot of the features are still in the planning phase.
At the end of the day, I do like the concept, and I wish the team the best of luck, but I also want to be clear that this is not an official endorsement and is not financial advice. Especially with relatively new projects, it is always important to do your own research and accept full responsibility for whatever financial decisions you make.
As always, thanks for reading!