Blockchain is becoming widely recognized as a medium that can eliminate many of the challenges faced in different fields. The trading industry is one such field that lacks a streamlined operation. With use of blockchain technology issuing of stock will become a more acceptable form. Many jurisdictions including Nevada, Delaware, Illinois, Dubai and Russia have enforced laws recognizing the application of blockchain.
With blockchain technology it is easier to handle corporate transactions and records related to transfer of stock ownership, dividends and proxy voting. Thus companies will be able to trade shares, register issue of shares over a blockchain seamlessly. Stock splits and proxy voting are other aspects that can be made more efficient.
Making financial trading less complex
Ever since its creation, blockchain has garnered attention with huge amounts invested on development and application of the technology. The distributed ledger format in the technology, which is the basis for all the cryptocurrencies including bitcoin, has a very huge potential.
The ledgers help in providing immutable, shared and single record of transactions. Thus the need for banks to track or store money is avoided. This can be used in stock trades and property records too with the same success.
When used with the smart contracts, which are software programs that execute instructions, blockchain can completely eliminate intermediaries which increase complexity and cost of even the most basic transactions. In areas such as issuance of stock, trading, settlement and other functions of stock market the technology can simplify things and make the process more efficient.
Stepping into venture capital
Venture capital market, which was earlier a much closed insider only market, has been turned into a digital and liquid fund market. With the help of blockchain technology, the liquid venture funds offered provide liquidity that you cannot find in the conventional VC funds. This helps level the playing field for VC individuals and institutions. With the tokens you will be able to
- Deal with premium companies
- Reduce fees without any middlemen
- Have option to increase exposure or take profits
- Does not have any barriers or minimums for traded token entry
- Repurchase has good inbuilt value increase
Hack, a part of Hackers/Founders Fund is one such liquid fund with blockchain base that provides fast liquidity for investors. In the traditional system of startup investing, gains can be realized only when the company goes public or is purchased. IPOs, acquisitions and other such liquidity events are a rare happening.
Thus investors are left in a lurch with their investment not giving them the profit they want. With Hack liquid fund, investors can see returns by means of selling, buying and trading tokens from the high performing startup pool at H/F. Another beneficial factor about HACK is it makes investing in startup available to investors of all levels.
With the cost of Hack token being $1 USD in the token sale period, the minimum token price helps easy entry into the venture fund. Investors also can make profit from startups which have not been identified due to their location being inaccessible because of markets, regulations etc. The decentralized nature of blockchain technology has made capital which would otherwise remain unused to be of great value for interested investors. Read more from the Hack white paper here.