This subreddit exists to openly discuss [Litecoin](https://litecoin.org). Read the [comparison](http://litecoin.info/Comparison_between_Litecoin_and_Bitcoin) between Litecoin and Bitcoin.
I've only recently been researching and thinking about getting into Bitcoin and cryptocurrencies. One of the things I came across was the Global Bitcoin Stock Exchange debacle. submitted by
I've looked around a lot and I can't seem to find whatever place or places replaced it while learning from its mistakes. Anywhere you can direct me would be appreciated.
I posted a link to my yours.org the other day, but due to that sites activity being far less than this site, I've decided to upload my posts here for at least a little while, and will continue to post updates here if people find them interesting. As my previous post stated, all input, positive and of course negative is more than welcome. Coloured Coins; the Basics: https://np.reddit.com/btc/comments/7ne47b/coloured_coins_the_basics_non_technical/
This post is an extension of my "Coloured Coins; the basics" where I touched on the concept of coloured coins and how it relates to Bitcoin (cash), the blockchain and the decentralizing movement we are currently seeing develop within finance and economics in the form of electronic peer-to-peer payment systems. I will be expanding upon the idea of a decentralized and global equities exchange that can be made possible by the use of coloured tokens on Bitcoin.
A lot of people within this cryptocurrency space found themselves here, not through an interest in finance or economics, but instead through computer science and programming, or even just an interest in gambling or playing with new and interesting tech. For those of you who know nothing of finance and economics and who have never bought or sold a stock in a company, I will briefly explain what equity investing is and then how coloured coins can change the current methods used today. Typical methods of investing see an individual buy a small portion of a company that they believe will yield positive profits into the future. By purchasing 0.1% of the company, they entitle themselves to 0.1% of that companies profits, paid out in the form of a dividend. These holdings are called stocks, and they are bought and sold through the use of stock exchanges typically contained within a country (currently, there is no global stock exchange). If you've ever heard someone say; "You can't invest in Bitcoin, you can only hold and speculate on its price.", they are following the belief, that because you are not purchasing equity in a system designed to return a profit, you are not investing in the traditional sense.
To purchase Bitcoin is not the same as an equity investment in a company that yeilds profits for shareholders; paid out in the form of a dividend. Bitcoin is a tool, not a system of value creation. It can be seen as an investment and perhaps its primary use right now is just that; a speculative investment, but I believe when we pass this initial adoption phase, and the tool starts to shine in the ways its truly meant to, thats when things get fun. Bitcoin as a tool; A decentralized and global stock exchange
My previous post touched on this idea of a blockchain based, Decentralised Stock Exchange (DSE), built on top of the Bitcoin (cash) protocol. This is not my original idea, and I am definitely not the first person to expand upon it, I do however have a passion for finance, and felt this idea deserved a post of its own due to the nature and magnitude that this could change the current global equities markets. I've talked about how coloured coins open doors to making a DSE possible, the point of this post is to explore it in more depth, talking about what it could look like, and why I (and many others I assume) would want it to exist.
Before we talk about the how and why of this DSE, lets briefly cover how stocks have been traded in the past and how the trading is currently handled.
Before the introduction and wide spread use of the internet, stock trading was typically handled by a person known as a broker. For the average person to purchase a stock, they would seek the services and usually advice of a broker on which stocks they should buy. This service came with a hefty fee that made investing more niche that it is today. If you were looking to invest $1000 into the market, but you didn't know how or what to purchase, you would enlist the help of a broker. This consultation could very easily take an hour or more and cost around $100. A typical healthy yearly return for a stable blue chip or index fund (a collection of blue chip stocks) in the market is anywhere from 8-12%. This essentially means, that prior to the adoption of the internet, an individual looking to invest $1000 would need to sacrifice a good years worth of returns (10%) in fees, and thats not even factoring in the opportunity cost associated with letting that money sit in a 4% savings account in the early 2000s instead. Very few, if anyone would have purchased less than $2000 or even less than $5000 at any one time with fees of around $100.
Fast forward to today, and what do we have? To purchase stocks now, an individual will most likely seek advice on the internet, and use an online service provided by his or her bank that allows the user to trade on the stock exchange within the country. Use of this service comes with a brokerage fee, however, due to the automation from the program, trades are faster and less human recources are expended, so fees are lower. In Australia a typical brokerage fee to purchase a packet of shares online would be $20. In todays world, interest rates have fallen and the stock markets, especially within the first world countries, have become a lot more efficient (approaching a theory known as the efficient market hypothesis), and thus returns are lower. So that $20 that doesn't sound like a lot, can bite into your returns if you are purchasing only a small amount, which we will explore now. Lets say you have $500 that you are looking to invest in a low risk large collection of shares such as an index fund. That $20 now equates to 4% of your total purchase. In the current market, a good year could return roughly 8%. Now you've sacrificed half a years profits (4%) on just the purchasing of the stock. I believe with the methods of purchasing stocks we have today, to spend less than $2000 on any one transaction is inadvisable (this means that you are paying a 1% fee of your initial investment).
So we've gone from $5000 to $2000 for a reasonable purchase, for some people these amounts are affortable, but many more people looking to invest just dont have that kind of money ready to park and leave in the market long into the future.
Now we are getting to the next step in this process; the blockchain model. By allowing companies to offer up equity in the form of nonfungable coloured coins ontop of a decentralised global public blockchain, you have opened this market up to everyone with an internet connection and any amount of spare cash. I see no reason why fees would need to exceed anything past a couple of cents, if they were too high, another person would be able to implement a competing system with lower fees due to the open source nature of the Bitcoin protocol. Transactions would be as fast as any other on the network, and individuals would be able to buy or sell equity across country lines without banks and government regulations. By building an equities exchange on top of Bitcoin, every person with an internet connection would have access to buy or sell equity in a company from anyone anywhere on the planet, essentially instantly and basically for free. This is an anarchists dream, it could usher in a new era in globalised trade, that in so far as Bitcoin is unhackable, would be completely secure.
Lets talk about regulation and IPO requirements
In Australia the current requirments for a business to go public on the stock market through an initial public offering (IPO) are as follows; A minimum of 300 non-affiliated investors at A$2000, they must offer up a free float of 20% in equity, they must pass a profit test whereby they are required to have consolidated A$1 million in profit from continued operations over the past 3 years, as well as A$500,000 profit from continuing operations over the last 12 months, or they are required to have either A$4million in net tangible assets, or A$15million market capitalisation. These figures can be found at http://www.asx.com.au
The specific details don't matter, what matters is; companies need to be large and selling equity is not currently a possibility for the vast majority of small and even medium sized businesses. And on top of that, the current model also requires a set of ongoing and public financial reporting that all past, present and future share holders must have access to. The blockchain model would not only allow more people to buy stock in companies across the planet, but it would allow smaller businesses the opportunity to raise capital by selling equity; a system of financing that has potential to bring massive growth to those its available to. However, this is where things can get dicey.
Some would argue these stock exchange markets need governing bodies to oversee that things are done properly and that businesses can't scam or mislead people into purchasing stock that they otherwise would not have, had they been privvy to all the information. My personal opinion on this is that I don't know for sure whether a decentralised exchange would be able to succeed in a world that lacks centralised regulation, however I tend to believe less regulation is more often better than more, and if there became a demand for regulation/oversite, then perhaps a private business that monitors and confirms the legitimacy of companies that are trying to sell equity on the blockchain would be set up. This company would sell this service, and their reputation, business model and profits would be effected if they were found to be dodgy, thus they would have incentive to maintain legitimate practices.
Thats all I have to say on the topic of decentralised stock markets. The prospect excites me a great deal, and I look forward to hearing what you guys think.
Bitcoin Vault is developed to provide an extra level of security based on a three-private-key security structure. It features all the convenience of Bitcoin while adding important features allowing user transparency and freedom. Bitcoin Vault is our answer to issues faced by the crypto community over the last decade. Last Update June 8th, 2020.A Bitcoin Stock Exchange is a trading platform where people can access real-time prices to freely buy, sell or exchange bitcoin with other virtual currencies or traditional fiat currencies such as the US dollar ($), Euro (€) or British Pound (£).. In order to trade professionally and have full access to various trading tools, customers must open an account on a ... By combining an institutional grade digital asset exchange with a licensed e-money institution on the same platform, we are ensuring that the crypto trader or company is no longer required to have a bank account at a legacy financial institution to do their business. With Globitex you can do it all from converting digital assets into fiat currency to sending fiat directly to another exchange ... Global Bitcoin Limited.For the purpose of breaking into the financial market, Global bitcoin Limited Ltd is the company to be aligned with. Our team of experts provides the full range of services you need to set up an investment portfolio and make your investment a long-term success. Bitcoin global venture is an easy, fast and secure way to make money. Join our affliate program and get paid. *Earn 5% of bitcoin global venture commission on a refferal. *Our affliate program has “NO LIMITATION”! The more customers you refer the more commision you earn. *Earning are paid on each deposit your refferral made.
Bitcoin Daily 02-03-20 Global Markets And Bitcoin Monday Morning ... cryptocurrency bitcoin original cryptocurrency exchange rates cryptocurrency trading reddit cryptocurrency investment ... SHOW RESOURCES: Central Banks “running out of road” according to Bitmex research https://decrypt.co/22779/bitcoin-exchange-central-banks-have-run-out-of-road... BEST Place To Trade Bitcoin & Crypto for Euros - Bitpanda Global Exchange - Duration: 9:58. The Crypto Lark 3,042 views. 9:58. ... Bitcoin? Gold? Stocks? Cash? - Duration: 13:05. The Crypto Lark ... Bitcoin, Cryptocurrency, Finance & Global News - May 31st 2020 In this week's market update we cover all the latest headlines from Australia, US, China, Europe & other global markets. This will ... Educate yourself on how to trade Bitcoin correctly, just like I have done. If you take all 3 levels, the last level is jaw-dropping as you will learn how to buy stocks for free. Get a $50 discount ...