Numerai is an artificial intelligence hedge fund that collects data on stock markets. Data scientists can use this information and build machine learning models on it in order to facilitate market predictions. In a sense, data mining Numerai’s data is equivalent to typical cryptocurrency mining, and predictions that are submitted using this data are the proof of work. Users can stake Numeraire tokens on their predictions, which can be done by sending the tokens to Numerai’s Ethereum smart contract, with accurate predictions being rewarded and inaccurate ones losing out. Numerai aims to incentivize data scientists to collaborate with others and bring more people to Numerai (unlike the traditional stock market).
Numeraire (NMR) is the ERC20 token that is used for staking and paying out rewards, with new Numeraire being created to pay rewards.