Tokenization of real-world assets - page 2.

awik p

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Quote from: eminemcookie on January 06, 2019, 05:14:26 PM

Quote from: bitmover on January 06, 2019, 07:53:00 AM

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system, it is not hard for people to currently buy or sell stocks. The only difference I can think of is the ledger but do people really want to see how many stocks others hold and when they're sold/bought/moved

The advantage would be to trade stocks even when the market is closed.
One more advantage would be to be able to buy USA stocks from anywhere in the world. If you live in a 3rd world countryy cannot buy USA stocks from here.

The disadvantages are obvious and are bigger than any advantage:
- you have to trust the third party who made the toekn really has those stocks backed up. Just like tether.
- legal problems, in case sec doesn't like this.

Yep, I started to grasp that from a few other responses but thank you nonetheless. It seems that there's going to be a huge number of difficulties to face for this to happen. I can't really see it happening unless a major established stock exchange or company do it themselves. We don't need another tether like situation to loom over an already precarious market.

I think it still takes a long time for the asset tokenization for many people, seeing the current development there are still many obstacles that must be overcome. it seems easy, but this will be difficult if it is not supported by the supporting elements of the development of tokenisation, so that it requires support from the parties concerned

figmentofmyass

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Quote from: Theb on January 06, 2019, 09:40:24 AM

Aren't stocks right now existing digitally? That is why if you are buying and selling you just execute your order in your online trading platform. If you are still thinking that we are still keeping stock certificates then you are wrong most of the investors here keep their stocks in their online portfolio. So I really don't get what you are saying here because stocks even commodities like gold exist digitally now.

trading stocks or gold is done digitally through an online broker, but you're limited to a handful of brokers and you're stuck with their fees/limits/requirements. in other words, you're stuck transacting through intermediaries. and there are often jurisdictional restrictions too---it can be difficult to buy foreign stocks.

tokenized assets can change that. they can be traded p2p globally via the blockchain 24 hours a day. tokens can be traded on a DEX, avoiding brokers entirely. investors can access markets they previously couldn't.

eminemcookie

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Quote from: bitmover on January 06, 2019, 07:53:00 AM

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system, it is not hard for people to currently buy or sell stocks. The only difference I can think of is the ledger but do people really want to see how many stocks others hold and when they're sold/bought/moved

The advantage would be to trade stocks even when the market is closed.
One more advantage would be to be able to buy USA stocks from anywhere in the world. If you live in a 3rd world countryy cannot buy USA stocks from here.

The disadvantages are obvious and are bigger than any advantage:
- you have to trust the third party who made the toekn really has those stocks backed up. Just like tether.
- legal problems, in case sec doesn't like this.

Yep, I started to grasp that from a few other responses but thank you nonetheless. It seems that there's going to be a huge number of difficulties to face for this to happen. I can't really see it happening unless a major established stock exchange or company do it themselves. We don't need another tether like situation to loom over an already precarious market.

Theb

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Aren't stocks right now existing digitally? That is why if you are buying and selling you just execute your order in your online trading platform. If you are still thinking that we are still keeping stock certificates then you are wrong most of the investors here keep their stocks in their online portfolio. So I really don't get what you are saying here because stocks even commodities like gold exist digitally now. Also I don't think we need the Blockchain integration you are talking about because as of now the NYSE is heavily monitored by SEC which you know is always active on filing white collar crimes.

Kevin77

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Quote from: self love sisters on January 04, 2019, 07:52:56 AM

A news a while ago releases that DX. Exchange plans to offer digital versions of big U.S. stocks. Others believe that this is the beginning of the traditional market’s merge with blockchain technology but some people thinks about it in a negative way. What are your thoughts about this news? Huh

It will eventually become decentralized. I mean even the crypto exchanges have a middleman right now, there are some decentralized exchanges between people where there is no middleman but that is taking sometime. If it is taking sometime INSIDE the crypto space, it will be a while before we can have other investment options in decentralized sense.

All the above, it is a right step forward to be able to buy stocks and so forth with crypto so you can actually still keep your money in crypto while investing into other stuff. Right now stocks are very low due to the economical crisis but if people start to buy stuff with crypto there than they can win double, both when crypto increases in value and also when the stocks go up as well. Which means they will probably suggest that to others and we can get more hype around it.

mcTether

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Quote from: self love sisters on January 04, 2019, 07:52:56 AM

A news a while ago releases that DX. Exchange plans to offer digital versions of big U.S. stocks. Others believe that this is the beginning of the traditional market’s merge with blockchain technology but some people thinks about it in a negative way. What are your thoughts about this news? Huh

This is exactly where the entire world is heading. Everything in this world is going to be merged into blockchain. Every traditional market and financial services will also be merged into blockchain.

geyayy

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This is a bad news for banks because they are the one who hold funds for this kind of activity and they get commission for every transaction done weather its a loss or a profit. Now, if tokenization would be materialized, people will now have an access to these exchanges without giving much information and restriction and it would do great to exchanges because more investors means healthier profit.

coingecko

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Tokenization of real world assets is going to be challenging for the following reasons
1. Requires trust to some extend as there is still some ownership (in the real world) that is tied to a token
2. Requires recognition from all parties (the public, the court, government, entities, etc.) for arbitration reason
3. The blockchain platform needs to be stable which at this moment still early days due to constant development

It would be more interesting to see more experiments in the digital world being created utilizing blockchain rather than a straight up tokenization of real world assets. At least let the experiment run first until the tech is ready.

If you recall, it is not digital newspaper that took off on the internet; there might be new use cases that will be unlocked.

bitmover

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Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system, it is not hard for people to currently buy or sell stocks. The only difference I can think of is the ledger but do people really want to see how many stocks others hold and when they're sold/bought/moved

The advantage would be to trade stocks even when the market is closed.
One more advantage would be to be able to buy USA stocks from anywhere in the world. If you live in a 3rd world countryy cannot buy USA stocks from here.

The disadvantages are obvious and are bigger than any advantage:
- you have to trust the third party who made the toekn really has those stocks backed up. Just like tether.
- legal problems, in case sec doesn't like this.

davis196

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Quote from: self love sisters on January 04, 2019, 07:52:56 AM

A news a while ago releases that DX. Exchange plans to offer digital versions of big U.S. stocks. Others believe that this is the beginning of the traditional market’s merge with blockchain technology but some people thinks about it in a negative way. What are your thoughts about this news? Huh

It's most likely a scam,or just a stupid idea that is about to fail.
Everything can be tokenized.Some devs might create a "tomatocoin"-a token/coin which price is backed by the price of tomatoes.It's possible,but what's the point?Stock-tokens are nothing but a way to bring stock trading to the poor and ignorant.Eventually the poor and ignorant people will lose their money.

creeps

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Quote from: Indamuck on January 04, 2019, 12:40:26 PM

I'm not sure this would work well with a blockchain because if you lose your tokens they are gone forever. It's not like owning a regular stock where your information is in a centralized database that will never get lost. The only benefit I see is that it will allow people to buy fractions of a stock or asset that is very costly.

Its too risky for stocks to be tokenize and I don’t think it will happen sinces stocks are more centralized that can’t even go as a decentralized market. Let’s be contented for this two market to both exist with different function, just let people to choose where to invest. Its better to have more option that to focus in one thing.

freedomgo

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If this will bring opportunity for us to invest easily then I would agree with it.
In crypto, most of the projects are using tokens, and based on my experience, I am satisfied with it as you just have to buy a token and hold it, then you are now an investor or stockholder of a company. When there is already government intervention then it would be easier but we should be compliance with the guidelines they will release to avoid possible future problems.

mu_enrico

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I think, with the correct implementation, tokenization will improve the assets' velocity and liquidity. Surely it has cons, e.g., need to trust a 3rd party to hold the assets securely, and to audit it periodically. These might be a bit different for stocks.

Let's assume a company issues a stock via STO, underwriters need to prepare everything in accordance with the law, then sell the token to investors. Investors can hold their token in their wallet (not custodial account). The company still need to be audited for good governance though.

This tokenization is good! But, only as good as the 3rd party underwriter and auditor.

hatshepsut93

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Quote from: squatter on January 04, 2019, 04:28:02 PM

I suppose with tokenized assets, there's always trust involved. Even if you could use a DEX to trade tokens that are built on decentralized platforms, you still have to trust that the issuer will redeem them for real assets.

We're seeing this situation with new stablecoins like PAX. Paxos is analyzing the blockchain and freezing funds when customers attempt to deposit and redeem for real dollars. This will unfortunately become commonplace in the future. The idea of tokenized assets seems great if it means you can avoid KYC by trading on P2P or DEX markets. Unfortunately, the centralized issuer model can throw a wrench into such plans.

And this is why I'm so skeptical about many blockchain projects, they so often end up having some centralized body in its core that connects their blockchain with real world, thus defeating the whole purpose of the blockchain. After that the only good thing left is publicity and immutability, but those things are not always great - publicity means no privacy, which is bad in many cases, and immutability means that errors are permanent. This again means that blockchain has many limits and can't be slapped onto everything in this world.

eminemcookie

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Quote from: mk4 on January 04, 2019, 12:30:32 PM

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system,

Not 100% sure, but probably the option to buy/sell these stocks through using bitcoin or other cryptocurrencies, instead of using fiat.

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

it is not hard for people to currently buy or sell stocks.

I don't think so. Investing in stocks(especially US stocks or whatever foreign stock) are probably difficult, especially if you're living on a 3rd world country, as chances are, you're probably only limited to stocks of businesses in your country. I really can't say how advantageous this exchange will be though. I'm honestly expecting strict KYC/AML requirements.

Using it to circumvent laws isn't going to go down kindly with regulators if that is the reason.

Quote from: OgNasty on January 04, 2019, 01:42:39 PM

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system, it is not hard for people to currently buy or sell stocks. The only difference I can think of is the ledger but do people really want to see how many stocks others hold and when they're sold/bought/moved

In one word, transparency. With today's exchanges you don't even own real stock. You pay a custodian who claims to own the shares and they are regularly audited by government agencies to make sure they have the stock to back up their ownership claims to customers. Many skeptics believe that there aren't appropriate auditing methods in place to account for all customer stock ownership claims. Having assets be tokenized would allow custodians or individual customers to prove their ownership claims using a public blockchain as opposed to trusting custodians and auditors. There is no doubt in my mind that tokenization of assets will take place, but whether it will be on the Bitcoin blockchain, a secondary asset layer, or an entirely separate chain will be for the future to decide.

Right, so then this would only be an improvement if the company that issued the stock were the ones who enforced the change. I imagined for the most part it would be similar to what you said where some company would be claiming to hold real stocks and then issuing blockchain stocks.

squatter

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Quote from: mk4 on January 04, 2019, 07:59:17 AM

It's really not decentralized, because you still have to trust a middleman, but hey. Though it's definitely not for everyone, having the option to invest in "tokenized" versions of stocks is a good thing in my opinion; I just hope that people know how it actually works before throwing their money into it. In this case, it's pretty much just the case of, if you don't like it, then don't buy it.

Will I be using it? I really don't know. I'd have to do some research on DX if they really actually are trustworthy enough or not.

I suppose with tokenized assets, there's always trust involved. Even if you could use a DEX to trade tokens that are built on decentralized platforms, you still have to trust that the issuer will redeem them for real assets.

We're seeing this situation with new stablecoins like PAX. Paxos is analyzing the blockchain and freezing funds when customers attempt to deposit and redeem for real dollars. This will unfortunately become commonplace in the future. The idea of tokenized assets seems great if it means you can avoid KYC by trading on P2P or DEX markets. Unfortunately, the centralized issuer model can throw a wrench into such plans.

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Quote from: self love sisters on January 04, 2019, 07:52:56 AM

A news a while ago releases that DX. Exchange plans to offer digital versions of big U.S. stocks. Others believe that this is the beginning of the traditional market’s merge with blockchain technology but some people thinks about it in a negative way. What are your thoughts about this news? Huh

Quote from: mk4 on January 04, 2019, 07:59:17 AM

It's really not decentralized, because you still have to trust a middleman, but hey. Though it's definitely not for everyone, having the option to invest in "tokenized" versions of stocks is a good thing in my opinion; I just hope that people know how it actually works before throwing their money into it. In this case, it's pretty much just the case of, if you don't like it, then don't buy it.

Will I be using it? I really don't know. I'd have to do some research on DX if they really actually are trustworthy enough or not.

Yep, it has nothing to do with decentralization, but it's still some usage of blockchain. I also think it's a positive thing, because at least this way people will get to know blockchain more. However, I am not sure there will be people who'll buy these tokenized assets... Crypto investors are valuing decentralization and volatility, investing in tokenized stocks will be close to investing in stable coins for them. As for stock traders, I don't see why they'd be interested to go through some shady intermediary and deal with unknown technology if they can simply buy stock they way they usually do. Backing cryptos up with stocks is just another weird experiment that will probably lead to nothing. But the idea is not that bad in terms of attempts to promote blockchain.

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Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system, it is not hard for people to currently buy or sell stocks. The only difference I can think of is the ledger but do people really want to see how many stocks others hold and when they're sold/bought/moved

In one word, transparency. With today's exchanges you don't even own real stock. You pay a custodian who claims to own the shares and they are regularly audited by government agencies to make sure they have the stock to back up their ownership claims to customers. Many skeptics believe that there aren't appropriate auditing methods in place to account for all customer stock ownership claims. Having assets be tokenized would allow custodians or individual customers to prove their ownership claims using a public blockchain as opposed to trusting custodians and auditors. There is no doubt in my mind that tokenization of assets will take place, but whether it will be on the Bitcoin blockchain, a secondary asset layer, or an entirely separate chain will be for the future to decide.

Quote from: Indamuck on January 04, 2019, 12:40:26 PM

I'm not sure this would work well with a blockchain because if you lose your tokens they are gone forever. It's not like owning a regular stock where your information is in a centralized database that will never get lost.

You seem to have these backwards. Blockchains are forever, centralized databases are easily manipulated.

Indamuck

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I'm not sure this would work well with a blockchain because if you lose your tokens they are gone forever. It's not like owning a regular stock where your information is in a centralized database that will never get lost. The only benefit I see is that it will allow people to buy fractions of a stock or asset that is very costly.

mk4

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Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

Can someone explain to me the benefit in doing this? How is it an improvement on the traditional system,

Not 100% sure, but probably the option to buy/sell these stocks through using bitcoin or other cryptocurrencies, instead of using fiat.

Quote from: eminemcookie on January 04, 2019, 11:45:01 AM

it is not hard for people to currently buy or sell stocks.

I don't think so. Investing in stocks(especially US stocks or whatever foreign stock) are probably difficult, especially if you're living on a 3rd world country, as chances are, you're probably only limited to stocks of businesses in your country. I really can't say how advantageous this exchange will be though. I'm honestly expecting strict KYC/AML requirements.

Topic: Tokenization of real-world assets - page 2. (Read 457 times)