Bitcoins/Litecoins/Virtual Currencies

IYKYK

Seananigans said:

I mean, who the fuck would sell more than they need to of the obvious superior store of wealth that will definitely continue to increase in value relative to the dollar because it hasn't hit critical mass yet? If he doesn't need $300 million today for some reason, why would he liquidate it when it will be worth $3 billion at some point in the future?

Click to expand...

Because shit happens? Even sound reasoning can be thrown off by unforeseen events.

Anyway, I used to work with a guy who farmed bitcoin at the very beginning $$$ He farmed millions and millions worth of coins $$ Unfortunately he sold them for 1 dollar per coin, and he doesn't own a single coin now. He took it well on the outside.

I'm about to finally dip my toes into crypto.. pick up $500 bitcoin every month for the sake of diversifying out of stocks

Crypto popping off rn. Alts finally getting some love. Think we will be getting some interesting world news here shortly.

I’m not sure alts deserve love. I get the money making aspect of alts. But I’ve seen maybe 4-5 alt coins that offer non-pumpndump value. They are all shit.

I’m not a Bitcoin purist or anything but at least I get the general concept there. But the alt coins, in general are pure garbage

Rangoth said:

I’m not sure alts deserve love. I get the money making aspect of alts. But I’ve seen maybe 4-5 alt coins that offer non-pumpndump value. They are all shit.

I’m not a Bitcoin purist or anything but at least I get the general concept there. But the alt coins, in general are pure garbage

Click to expand...

Can't say you're wrong! But it's the whole money making part that I'm interested in, so

Not too different from going to a casino, but then I like to go to casinos occasionally too.

Tbf like Rangoth mentioned, there are a handful of interesting Alts that show promise for real world use- but 99% of coins out there are pure trash.

For example, looking increasingly like they are going to tokenize stocks (among other financial instruments). Who knows what chain they'll use (AVAX, Base, SOL?) but it almost certainly WON'T be BTC. Pick the right chain for something like that and you'll make quite a bit of money.

For someone who dabbles….wtf does “tokenize stocks” mean? By definition are they not already ”tokenized” I buy a share and this I own 1 “amc-coin” or “google-coin”…is that not exactly what a share is?

about the ONLY thing I can see improving via “tokenizing” stocks is that it would, in theory, 100% put a stop to shaded ass market shit like shorting more shares than exist and shit like that as every “token” would be on chain and tracked. So in that sense I’m for it, but it’s not a truly novel concept. The SEC Could stop the shady shit now if it wanted(it doesn’t), it’s not a technology problem.

Very much a dabbler myself, and I'm not going to pretend I know a ton about this stuff either but:

The idea is to represent ownership of stocks as tokens on a blockchain. You could either back the tokens 1:1 with real shares held in custody (like stablecoins are backed by fiat), or a company could simply issue its shares directly on the blockchain as digital tokens. So if Apple (for example) launched a new class of stock, instead of listing it on Nasdaq and keeping the shareholder ledger with a transfer agent, it could just issue tokenized shares on (say) Avalanche. The tokens would represent real equity in Apple, with dividend rights, voting rights, etc. All shareholder transactions happen on chain, visible to anyone, and settle instantly.

It's actually way simpler than it sounds. The whole idea of "stocks" and the "stock market" is way, way more complicated than companies simply issuing tokens on a blockchain directly to purchasers. Not only is it way more transparent, but it eliminates a whole lot of middle men (mostly).

You can get global capital access, instant settlement, smart contract automation (dividends, voting, splits could be automated), transparency, and low issuance costs (especially for startups). Huge benefits for everyone involved.

FWIW, I have no idea why anyone would bother with the first option- the whole 1:1 tokens backed by real stock stuff. Makes zero sense. Just bypass that step entirely and use tokens.

I came across the article 3 or 4 years ago Cryptocurrencies Won't Replace Currencies: They Will Replace Stock Exchanges and actually mentioned the idea in this very thread. I got totally shit on lol. But here we are years later and it looks like it's happening.

Some half truths there.

First to note, last year trade settlements were updated to T+1, so all trades are settled overnight basically.

Also, there are plenty of brokers that do not participate in payments for order flow. There are also brokers that offer direct exchange routing.

It’s Joe Blow retail who either dabble in stocks and aren’t aware of it or just buy and hold and don’t care about it.

Paying for order flow is also something the SEC can (and maybe should) just ban. UK already banned it a decade ago, EU follows suit from next year.

Jysin said:

Some half truths there.

First to note, last year trade settlements were updated to T+1, so all trades are settled overnight basically.

Also, there are plenty of brokers that do not participate in payments for order flow. There are also brokers that offer direct exchange routing.

It’s Joe Blow retail who either dabble in stocks and aren’t aware of it or just buy and hold and don’t care about it.

Click to expand...

He may not have had all the details right, but his main point is still applicable. The current system is antiquated, overly complicated, bloated with middle men, opaque, and very much rigged to benefit an entire class of people who came into being by preying on retail (Joe Blow) investors. The system is dying for a 21st century overhaul.

Will tokenizing improve things? Almost certainly. How much? That's more vague.

I like the idea of tokenization for all the benefits I already mentioned- especially transparency and simplicity. But I'm not selling anything and I'm not a cheerleader, so I have to be honest: if anyone thinks tokenization is going to remove all the middle men and fuckery, think again.

For starters, you need look no further than the people pushing tokenization-- the Larry Finks of the world. Think that guy wants tokenization to benefit "the people?" Lol. Plenty of people are going to be making money by skimming off the top, starting with the crypto exchanges.

And yes, blockchain tech probably will make things a little more transparent, but there will still be plenty of bullshit behind the scenes. Start digging into the details of how tokenomics works and you will see there is still plenty of fuckery to be had-- just a different kind of fuckery from stocks.

Anyway, like I said, I look forward to the idea of tokenization, but I'd encourage everyone to be clear-eyed about it. If it even happens it's very much going to be a "meet the new boss..." scenario

Tmac said:

Oh sweet summer child.

You pay your broker for stock, they then go to a market maker who matches your buy order with a sell order almost istantly, then it takes two days for the trade to "settle" and officially transfer to you.

The market maker pays the broker for the privilege and the market maker profits by settling at a slightly lower price than you paid, it's legal and regulated, but it means your order may not go directly to the exchange. And the big boys get to be in the front of the line always.

Tokenization would remove the middle men, bc then you'd be directly purchasing the token (share) of stock instead of working through a brokerage and market maker.

Click to expand...

if you took out the market makers/middle men, wouldn’t that fucking crush liquidity? I guess you could open up to world trading 24/7, which I would be for….

I am fairly novice in terms of blockchain technicalities, but if I am correct, transaction volume on blockchain is a massive hurdle, no? Especially when we start talking about pure volume of transactions in the global stock markets. What kind of compute would be required to keep up with that ledger?

Jysin said:

I am fairly novice in terms of blockchain technicalities, but if I am correct, transaction volume on blockchain is a massive hurdle, no? Especially when we start talking about pure volume of transactions in the global stock markets. What kind of compute would be required to keep up with that ledger?

Click to expand...

The global stock markets handle something like a billion transactions per day during peak times (300m-500m normally). I think SOL is the fastest and they can do 65k tps, but they start having stability problems at that point.

There are definitely more technically savvy people here who could probably explain it better than me, but batching thousands of transactions offline and then posting them online in one transaction is one way to deal with this (Optimistic and ZK Rollups e.g., Arbitrum, StarkNet, zkSync).

Another option is appchains/modular chains, which are basically blockchains built for one specific application-- like a stock exchange, a game, or a DeFi protocol. So instead of every asset fighting for (say) Ethereum block space, Apple stock can trade on one chain, Tesla on another, and both settle back to Ethereum for finality and security.

So yeah, my understanding is that the have theoretical solutions to being able to put something as big and important as the global stock market on chain, but we aren't quite there yet (as far as I know).