The aspect of Augur that is most striking to me is that the system seems capable of establishing decentralized, reliable facts-as-a-service. Augur could provide smart contracts and DAOs with a trustless understanding of real world conditions and events.
I can imagine a couple ways of abusing Augur for nefarious purposes. Would Augur be regulated in some way to prevent the following scenarios?
A Reporter buys vast sums of REP, and then reports falsely on a market (undermining the system at great financial cost). The falsely settled market triggers a condition in a smart contract (for example, an insurance policy), resulting in net financial gain for the attacker.
An organization creates (or observes) a market for whether a particular event will occur. They then create a smart contract which uses the results of Augur's prediction market to guarantee payment to whoever makes that event come to fruition.
For example, the organization's smart contract could allow for anyone to specify the time that a future event will occur (requiring them to post bond as proof of their serious intent to make the event occur at that time). If Augur determined that the event in fact happened during that reporting period, the person who registered with the smart contract would receive their guaranteed payout.
This would be really bad. Terrorist organizations could anonymously pay large sums to anonymous individuals who commit acts of terror on their behalf. Anyone with money could anonymously incentivize whatever events they want to occur.
In summary, I'm curious: how could we mitigate the potential negative societal consequences of a decentralized truth market? And are there examples of extremely positive societal consequences? Do the positives outweigh the negatives?