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Could Blockchain-Based Fractions of Digitized Stocks Revolutionize Markets? (venturebeat.com)
An anonymous reader quotes VentureBeat:
Despite being championed as a decentralized form of money that puts individuals firmly in control of their own wealth, cryptocurrencies mostly remain the preserve of the super-rich and the super-nerdy. 1,000 Bitcoin wallets currently hold 35.18% of all Bitcoins, for example, and only a select few computer scientists understand the inner workings and machinations of blockchains... Such inconvenient truths undermine the oft-repeated claim that blockchains will democratize wealth, largely by lowering barriers to entry in financial networks and by preventing central banks from devaluing money via inflation. Nonetheless, this prediction has moved one step closer to realization in recent months, with the emergence of tokenized stocks....
In contrast to a new cryptocurrency designed specifically to conform to securities legislation (i.e. a security token), tokenized stocks provide digitized versions of existing shares in established companies, such as Google, Facebook, or Apple... [W]hat's interesting and potentially radical about such digital stocks is that they permit customers to buy fractions of stocks in big companies. This will open up trading to millions of people who wouldn't otherwise be able to afford buying shares in Apple or Amazon...
One significant side effect of tokenized stocks is that they could change the fundamental nature of global stock markets and how they behave, by opening them up to round-the-clock trading... It's interesting to note that some commentators believe the growth of round-the-clock exchanges might, in the long term, result in the emergence of a single global stock market.
The article also notes that it will be cheaper to trade digital versions of stocks, "since person-to-person trades circumvent the need to go through a broker...
"They look set to make the financial world more accessible to millions people, in addition to having serious implications for global markets."
In contrast to a new cryptocurrency designed specifically to conform to securities legislation (i.e. a security token), tokenized stocks provide digitized versions of existing shares in established companies, such as Google, Facebook, or Apple... [W]hat's interesting and potentially radical about such digital stocks is that they permit customers to buy fractions of stocks in big companies. This will open up trading to millions of people who wouldn't otherwise be able to afford buying shares in Apple or Amazon...
One significant side effect of tokenized stocks is that they could change the fundamental nature of global stock markets and how they behave, by opening them up to round-the-clock trading... It's interesting to note that some commentators believe the growth of round-the-clock exchanges might, in the long term, result in the emergence of a single global stock market.
The article also notes that it will be cheaper to trade digital versions of stocks, "since person-to-person trades circumvent the need to go through a broker...
"They look set to make the financial world more accessible to millions people, in addition to having serious implications for global markets."
Long answer: fuck, no.
Instead of the whole tulip, we will sell you individual petals. Bitcoin tulips have 100 million petals each.
You can buy fractional shares of stock today. This claims to save some broker fees, but that has nothing to do with blockchain and sensible (small) investors don't trade stocks very often anyway.
Buzzword bingo it is!
It used to be that stocks paid dividends to shareholders. This rate was above and beyond interest on bank deposits, who loaned the money. There was extra risk, but there was also extra reward.
Fast forward to today and stocks are essentially a fun and lucrative gambling market for those so inclined. Money is made from trading and arbitrage, not dividends. The difference between a Google Class C stock share (non-voting, non-dividend-paying) and a unit of cryptocurrency is minimal, other than the class C has some favorable tax treatment. Dividends as a portion of share price is similar to bank deposit interest rates - tiny, with no risk premium, in chance that dividends are even paid.
This creates another market gamblers can play in. It will be dominated by the inside players with dedicated computing setups, and superior information and intelligence, like the existing financial markets. I don't know that it creates anything of value. It's a new gambling game. Central bank prints money, injects it into Wall Street, and it'll wind up here, and in other financial markets. Direct participants become richer, people with 401K's feel richer. I don't know that it will improve health care, education, housing, improve the standard of living of non-participants, or otherwise spark technological improvement.
True until 1996. At that time Berkshire Hathaway issued Class B shares which subsequently split and currently trade for $199 per share. They trade like any other similarly priced shares and have voting rights in Berkshire Hathaway like the original Class A shares but at a smaller ratio (logically).
https://www.investopedia.com/a...
I'm just saying that the Wikileaks thing doesn't prove anything about cryptocurrency. Apparently you agree.
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Congratulations. You're re-invented the mutual fund.
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