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Fake Tesla, Apple stocks have started trading on blockchains

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Re: Fake Tesla, Apple stocks have started trading on blockchains

#301

Post by mannykannot »

smabie wrote: post #206
mannykannot wrote: post #163

Earlier quoted context omitted.

Is it not that settlement nominally occurs when you choose to exit your position? Which raises various questions about whether whatever stack of turtles your swap is built on can provide liquidity when you need it.

The order book provides liquidity. When someone sells a swap, someone else buys it. Of course, the amount of liquidity and spread available will depend on how popular the coin or specific contract is.

Liquidity has a tendency to dry up when everyone wants it, especially in a highly-leveraged derivative. The fact that options have an expiration date seems to mean that trading cannot just stop when things are going badly.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#302

Post by as_i_fall »

beambot wrote: post #129
as_i_fall wrote: post #117

Earlier quoted context omitted.

Are these assets backed by legally binding contracts? If the answer is no it doesn't seem like a stretch. If I sold you a stock in my company that gave you none of the traditional shareholder rights I'd also call those shares "fake", which seems to be what's going on here.

Forward contacts and SPVs are two ways of encumbering share ownership without (necessarily) conferring all the rights of the underlying shares.

Sure, but those are backed by different legally binding contracts which also give legal recourse to buyers. My point is that unlike other types of synthetic assets these seem to have no legal backing and could quite conceivably be regulated out of existence in the future.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#303

Post by poorjohnmacafee »

logicchains wrote: post #195
poorjohnmacafee wrote: post #128

Can anyone explain why regulators wouldn't just smack this down if got big? I can't imagine you can create a mirror stock market without going through some regulatory channels.

The world exists outside of the US. There isn't one set of global "regulators". Lots of smaller countries want to grow their own financial markets and take a share of the US's pie, and being friendly to crypto is one way to achieve that.

I can't think of very many countries that don't have regulatory channels for selling stocks to their citizens. Generally wouldn't want to launch something that breaks local regulations if you serve nationals of those countries. Puts directors at risk if they visit those countries.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#304

Post by tablespoon »

MathYouF wrote: post #182
tablespoon wrote: post #52

Earlier quoted context omitted.

How does this make sense? If they don't hold the underlying security, where does the value come from? Come on, this is cryptocurrency. The whole point is to con people into thinking a fake thing is real because blockchain and cash in; with the off chance that if enough people believe, then their belief will make the fake thing real.

You should read up on the last decade in Venezuela, which used to be the richest country in Latin America, and having wealthy professionals see their savings evaporate due to 1,000,000% inflation because of the actions of a government they democratically elected. Belief is the only thing holding together a lot of the things that we rely on to keep society functioning the way it does. I'm guessing (though not assuming…

> You should read up on the last decade in Venezuela, which used to be the richest country in Latin America,

I'm well aware of the last decade in Venezuela. Hasn't cryptocurrency been so helpful there?

> and having wealthy professionals see their savings evaporate due to 1,000,000% inflation because of the actions of a government they democratically elected.

It's kinda weird that you focus on the fortunes of "wealthy professionals" in that disaster.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#305

Post by X6S1x6Okd1st »

lottin wrote: post #268
X6S1x6Okd1st wrote: post #85

Earlier quoted context omitted.

The fact that these offerings are non-custodial is innovative, as is the fact that they are always open (albeit if there's high demand the fees may be high enough to be prohibitive) FDIC & regulation kind of makes it so for most people most of the time it doesn't matter that banks are custodial. Offering these services without being custodial is innovative though. EDIT: The other major (IMO) innovative piece is the p…

> FDIC & regulation kind of makes it so for most people most of the time it doesn't matter that banks are custodial. Non-custodial means the owner is responsible for protecting the asset from theft and operational risks. Nobody wants that, especially not in the case of digital assets, which aren't governed by property rights and instead rely entirely on effective control of the asset to determine who "owns" it.

Do you really believe no one wants non-custodial financial services?

Re: Fake Tesla, Apple stocks have started trading on blockchains

#306

Post by lottin »

X6S1x6Okd1st wrote: post #305
lottin wrote: post #268

Earlier quoted context omitted.

> FDIC & regulation kind of makes it so for most people most of the time it doesn't matter that banks are custodial. Non-custodial means the owner is responsible for protecting the asset from theft and operational risks. Nobody wants that, especially not in the case of digital assets, which aren't governed by property rights and instead rely entirely on effective control of the asset to determine who "owns" it.

Do you really believe no one wants non-custodial financial services?

I already explained why non-custody is a dumb anti-feature that only appeals to a small number of conspiracy theorists who haven't really thought things through.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#307

Post by as_i_fall »

sneak wrote: post #173
tylersmith wrote: post #157

Earlier quoted context omitted.

Yes I think that's very likely. The closer DeFi gets to traditional markets the more likely enforcement is coming.

What are some possible enforcement mechanisms against Ethereum DeFi smart contracts?

I imagine very few people would be interested in smart contracts if it became a defacto legal standard in the US and Europe that these contracts are unenforceable.

Of course this doesn't address contracts being written out of Russia or traditional financial havens, but how valuable is a vehicle which can't be used to move assets into or within the US or Europe?

I think the question of enforcement is the wrong one.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#308

Post by rank0 »

dkshdkjshdk wrote: post #260
rank0 wrote: post #234

Earlier quoted context omitted.

Yes you can provide liquidity for eur-usd if you jump through all the hoops. A quick google search will show you that lots of savings accounts have positive yields. Rates have been low cause of fed action but banks have provided positive returns in savings accounts since like forever ago.

> Yes you can provide liquidity for eur-usd if you jump through all the hoops . The emphasized part is important. Most people either can't or don't know how to jump through these hoops. Is it even worth it to jump through these hoops, when I only have 100 USD to "invest"? Entities like Uniswap make the process much easier and widely-accessible, which makes a big difference (particularly if you live outside the develo…

I appreciate the effort you put into your response!

I think the conversation has diverged quite a bit from my original point. I’m not even trying to argue that uniswap is not useful or an improvement. Instead I’m pointing out that when we compare defi protocols to the traditional system, the core services are largely the same. Defi is an attempt to allow anyone to participate in the roles which are usually accessible only for institutions. That doesn’t mean those roles are just now being invented by uniswap/aave/whatever.

Unrelated Opinion: defi’s practical utility comes from circumventing regulation and adding leverage to a crypto position. (Eg no KYC, selling AAPL tokens, borrow tether against an ETH position to buy more ETH)

Re: Fake Tesla, Apple stocks have started trading on blockchains

#309

Post by rank0 »

DennisP wrote: post #257
rank0 wrote: post #234

Earlier quoted context omitted.

Yes you can provide liquidity for eur-usd if you jump through all the hoops. A quick google search will show you that lots of savings accounts have positive yields. Rates have been low cause of fed action but banks have provided positive returns in savings accounts since like forever ago.

Seems like a lot of blockchain critiques involve some variant of "you can already do that if you jump through all the hoops," without recognizing that it's worthwhile to remove the hoops.

It certainly might be worthwhile to remove the hoops!

The original discussion was whether or not defi protocols enable new financial services. I argue they do not, but instead attempt to automate/decentralize those services.

Re: Fake Tesla, Apple stocks have started trading on blockchains

#310

Post by verdverm »

dcolkitt wrote: post #147
verdverm wrote: post #94

Earlier quoted context omitted.

It's a law that requires financial institutions to "Know Their Customer" in order to operate legally. It's a reasonable law. Following existing regulations will be needed for crypto to have a chance at being mainstream

It’s not reasonable. The government should not be snooping into people’s financial accounts anymore than they should be snooping into people’s private homes or email inbox. It astounds me how even principled civil libertarians wholesale accept an Orwellian level of surveillance on anything related to money. The Founding Fathers would have all revolted at anything even resembling modern KYC/AML law.

KYC does not give the gov't your transaction history, it simply means that your financial institution needs to verify your identity. It is part of an overall strategy to reduce the amount of damage malevolent actors can create.

You might try reading the Federalist Papers before making claims about the founding fathers. Again, it is not surveillance by government anyhow.

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