Numeraire (NMR) is a blockchain-based hedge fund that uses AI and crowd-sourced trading algorithms.

NMR is the protocol’s native currency. It’s an ERC-20 token that helps secure the network via validator staking.

Backed by Renaissance Technologies co-founder Howard Morgan, the protocol aims to place a decentralized spin on popular quantitative trading strategies, according to Messari. The project’s core offering is The Numerai Tournament, a monthly competition in which users (the majority of whom are data scientists) design and submit bespoke trading algorithms designed to predict the stock market. Numerai allows users to stake NMR to the model they feel will offer the best performance.

These models are subsequently scored for accuracy, with the best-performing ones combined to form a ‘meta model’ on which the Numerai Hedge Fund trades the stock market. Users are rewarded with additional NMR for making correct predictions; on the other hand, those who bet incorrectly see their stake burned.

Further NMR is provided to users on account of the fund’s performance. 

Signals is another one of Numerai’s offerings in which participants submit and vote on trading signals. Depending on the signals' level of predictive value, users get rewarded with NMR.