Augur's reputation token is a ERC 20 token. It is used on the Augur prediction market platform. The software maintains the marketplace, order books for each market created. The platform is used for betting on outcome of various events created on the prediction market so others can participate on the events outcome. The smart contracts process all bets and outcomes and distributes rewards to the winners. The REP token is used for reporting event outcomes. The REP tokens need to be staked in order to participate in reporting event outcomes and to earn fees from the trading event.