INTERNET BASED PREDICTION MARKET

Abstract

ion market wherein articles of property are wagered in peer-to-peer contests wherein title to the goods passes to the participant that best predicts the outcome of a future event. Information relating to property posted on the exchange website by members is presented for browsing by other members. The property is assigned an approximate value for wagering purposes, which value may be simply assigned by the posting member or based on independent appraisal sources. Members are allowed to enter into peer-to-peer contests wherein a first posted property owned by a first member is wagered against a second posted property owned by a second member in a structured betting exchange wherein title to the first and second properties is determined by predicting the outcome of a future event, such as the close of the Dow Jones Industrial Average at the New York Stock Exchange at the end of a given day, the price of gold at the close of trading of an agreed upon day, or any other event, such as the winner of sporting event. The member that correctly predicts, or most closely predicts, the outcome of the agreed upon event is declared the winner and title to the article wagered by the losing member transfers to the winning member. The market maker may realize revenue in the form of a posting fee paid by members upon listing of goods, and in the form of a percentage of the value of the goods transferred.

Description

CROSS REFERENCE TO RELATED APPLICATIONS

[0001]N/A

STATEMENT REGARDING FEDERALLY SPONSORED RESEARCH OR DEVELOPMENT

[0002]N/A

COPYRIGHT NOTICE

[0003]A portion of the disclosure of this patent document contains material that is subject to copyright protection. The copyright owner has no objection to the facsimile reproduction by anyone of the patent document or patent disclosure as it appears in the Patent and Trademark Office patent file or records, but otherwise reserves all rights whatsoever.

BACKGROUND OF THE INVENTION

[0004]1. Field of the Invention

[0005]This invention relates generally to the field of electronic commerce and more particularly to an Internet based prediction market wherein goods are wagered in one-on-one contests wherein title to the goods passes to the participant that best predicts an agreed upon future event.

[0006]2. Description of Related Art

[0007]There are many ways to exchange or acquire pre-owned (e.g. used) goods. For example, retail selling provides a marketplace for sale of pre-owned goods wherein the goods are sold at prices set by a seller. Retail selling is advantageous to the seller because it allows the seller to control the price of the goods. Retail selling, however, requires the seller to maintain a large inventory of goods, which is expensive and disadvantageous. Electrornic commerce, or Internet-based sales are common and have problems similar to retail.

[0008]In addition, numerous online auctions may be found. In a forward auction one specifies a good to be sold in the auction and receives bids from parties wishing to purchase that good. In a reverse auction, a prospective buyer of goods or services specifies the good/service desired for purchase through the auction and receives bids from parties wishing to supply that good. An example of an online forward auction is that system used by ebay Inc. of San Jose, Calif., at www.ebay.com. Such auctions are better suited to unique goods but are also used for fungible goods. Bidding wars between buyers, however, can lead to high prices for such goods, whether new or used.

[0009]There remains a need in the art for advancements in the field of electronic commerce to allow for peer-to-peer betting of goods in a prediction market environment.

BRIEF SUMMARY OF THE INVENTION

[0010]The present invention overcomes the limitations and disadvantages in the art by providing an Internet based prediction market wherein articles of property are wagered in peer-to-peer contests wherein title to the goods passes to the participant that best predicts the outcome of a future event. The invention provides a method for facilitating the transfer of property of independent member parties through an on-line exchange. Information relating to property posted on the exchange website by members is presented for browsing by other members. The property is preferably assigned an approximate value which may be simply assigned by the posting member or based on independent appraisal sources. Members are allowed to enter into peer-to-peer contests wherein a first posted property owned by a first member is wagered against a second posted property owned by a second member in a structured betting exchange wherein title to the first and second properties is determined by predicting the outcome of a future event, such as the close of the Dow Jones Industrial Average at the New York Stock Exchange at the end of a given day, the price of gold at the close of trading of an agreed upon day, or any other event, such as the winner of sporting event. The member that correctly predicts, or most closely predicts, the outcome of the agreed upon event is declared the winner and title to the article wagered by the losing member transfers to the winning member. The market maker may realize revenue in the form of a posting fee paid by members upon listing of goods, and in the form of a percentage of the value of the goods transferred.

[0011]Accordingly, it is an object of the present invention to provide an Internet based prediction market and betting exchange.

[0012]Another object of the present invention is to provide such a system wherein goods transfer to the member that most closely predicts an agreed upon event.

[0013]These and other objects are met by the present invention which will become more apparent from the accompanying drawing and the following detailed description of the drawings and preferred embodiments.

BRIEF DESCRIPTION OF THE SEVERAL VIEWS OF THE DRAWINGS

[0014]FIG. 1 is a system block diagram of an Internet based predictive market exchange according to the present invention; and

[0015]FIG. 2 depicts a predictive market exchange process according to a preferred embodiment of the invention.

DETAILED DESCRIPTION OF THE INVENTION

[0016]With reference now to the drawings, FIGS. 1-2 depict a preferred embodiment an Internet based prediction market exchange system, generally referenced as 10, wherein articles of property are wagered in peer-to-peer contests wherein title to the goods passes to the participant that best predicts the outcome of a future event. FIG. 1 is a schematic diagram illustrating an Internet based prediction market system, generally referenced as 10, in accordance with the present invention. System 10 includes a plurality of registered users or members, referenced as 12A, 12B, and 12C. Using an Internet website 14, the members post information regarding property/goods available for wagering. The information is stored in a database 16 and made available to other members. The system further includes a predictive market component 18, wherein predictive events, such as the close of the Dow Jones Industrial Average, is established as a predictive event for use with the present invention. Predictive market component 18 may comprise any suitable event, the outcome of which may be undisputedly confirmed. Examples include, the spot price of gold at the close of trading on the world market at the close of trading on a given day day, or any other event, such as the winner of sporting event. The member that correctly predicts, or most closely predicts, the outcome of the agreed upon event is declared the winner and title to, and possession of, the article wagered by the losing member transfers to the winning member. The market coordinator may realize revenue in the form of a posting fee paid by members upon listing of goods, and in the form of a percentage of the value of the goods transferred.

[0017]As best illustrated in FIG. 2, members initiate the process by first contacting a properly configured Internet website established for practicing the predictive market betting exchange disclosed herein. In step 105, members register and open accounts with the system on-line by providing certain required personal information, such as member name, contact information, and any other suitable information, such as credit information. In step 110, members post information regarding property that they are willing to wager. As used herein, the term property shall mean without limitation articles or personal property, real property, or any other fungible goods. The posted information preferably includes at least one photograph, a written description, and an assigned value. The assigned value may be simply assigned by the posting member or based on independent appraisal sources. In step 115, the information relating to property posted on the exchange website by members is made accessible to other members. In step 120, other members browse and access the posted information. Property information is preferably categorized and browsing enhanced with search functions. In addition, members may post information for goods that they have an interest in acquiring.

[0018]In step 125, peer-to-peer wagers are proposed when a first member proposes a wager with a second member. The principal terms of the wager proposal include the property at stake for each member and the event upon which the members will submit a prediction. As should be apparent, the property at stake may include any goods or services acceptable to the participants. For example, a first member may propose a wager wherein the first member has his set of golf clubs at stake while the second member has a hunting rifle at stake, with the event being predicting the closing price of the Dow Jones Industrial Average on a certain date. The goods at stake need not be of identical value, but are rather based on the wants and desires of the participating members. As should be apparent, the terms are subject to negotiation. Step 130 illustrates the conclusion of the negotiation with the wager having been accepted.

[0019]In step 135, the participating members each confirm the principal terms of the wager, namely the goods at stake and the event to be predicted. A failure to achieve confirmation at this step will result in the resumption of negotiations between the members. In step 140, confidential event predictions are input into the system by each member participating in the wager. In step 145, the event is monitored by the system and the event outcome is determined. In step 150, the member that submitted the closest prediction to the event outcome is declared the winner. In step 155, the losing member is instructed to transfer the property he wagered to the winning member.

[0020]As noted above, the market maker may realize revenue in the form of a posting fee paid by members upon listing of goods, and in the form of a percentage of the value of the goods transferred. Posting fees are preferably charged and collected from the member upon posting of the goods. In addition, a fixed percentage of the value of the goods transferred may be charged upon completion of the event prediction and declaration of a winner. Such fees may be automatically debited from a member's credit card.

[0021]The instant invention has been shown and described herein in what is considered to be the most practical and preferred embodiment. It is recognized, however, that departures may be made therefrom within the scope of the invention and that obvious modifications will occur to a person skilled in the art.

Claims

1. A method of operating a prediction market wherein articles of property are wagered in peer-to-peer contests over a computer network, said method comprising:obtaining member registration information from a plurality of members via the computer network;receiving and posting information from members regarding goods available for wager via the computer network;making said posted information accessible to members over the global computer network;communicating a wager proposal made by a first member to a second member, said wager proposal identifying at least one good posted by each of said first and second members as the goods at stake, said wager proposal further including a event for outcome determination prediction;confirming the acceptance of a wager proposal;receiving event outcome predictions for said event from each of said first and second members;determining the outcome of said event;determining which of said first and second members most accurately predicted said event outcome and identifying said member as the winner and the other member as the loser;instructing the losing member to transfer the goods wagered by the losing member to the winning member.

2. A method of operating a prediction market according to claim 1, wherein said event for outcome determination prediction involves a stock market prediction.

3. A method of operating a prediction market according to claim 1, wherein said event for outcome determination prediction involves a commodity market prediction.

4. A method of operating a prediction market according to claim 1, wherein said event for outcome determination prediction involves a currency market prediction.

5. A method of operating a prediction market according to claim 1, wherein said event for outcome determination prediction involves a weather prediction.

6. A method of operating a prediction market according to claim 1, wherein said event for outcome determination prediction involves a sports outcome prediction.

7. A method of operating a prediction market according to claim 1, further including the step of charging members a posting fee upon posting information relating to goods.

8. A method of operating a prediction market according to claim 1, further including the step of charging said winning member a percentage of the value of the goods wagered by the losing member.

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