The Trump administration is preparing a new SEC framework that could let tokenized versions of stocks trade on DEXes.
The plan would use an “innovation exemption” and may allow tokens that track public companies even without the companies’ approval, while likely not granting normal shareholder rights like voting or dividends.
So without voting or dividends, they're not actually stocks, just "Coca Cola" coin or some other BS? Once they're off the stock market, I can't imagine any way their price could be pegged to the stocks (unless they try some stablecoin crap).
Most stocks worth buying don't pay dividends.
The tokens would have to be redeemable for shares of course, at least by market makers, to maintain the peg.
It seems like a positive development. It will give people in oppressive countries access to the US stock market, allow no-KYC stock ownership (hopefully), 24/7 trading, and make it possible to buy stocks with and sell them for BTC without going through the banking system.
Plenty of stocks (including blue chips like Apple and Coke) do still offer dividends, but that's secondary to how the prices of the blockchain "stocks" will relate to the stock market pricing, as well as the lack of any real ownership rights. Even if Coke licenses their name for the "Coke Coin," and makes money on it (in the same way that Trump made it on his coin), what actually makes it a stock?
The tokens will be pegged. The issuer will have to guarantee the peg, just like with stablecoins, and presumably they will have to show proof of backing, report regularly and be subject to audits.
Names are not the most important thing. There are probably dozens of tokens called USDT, but only one of them is backed by Tether, the others are scam tokens, and you tell them apart by looking at the token address.
Trump launched a coined that wasn't backed by anything. Tokens launched under the new regime will be backed and if they're not, they'll be non-compliant and exposed as such.
If BlackRock launches a token that represents NVDA stock, I'm sure there will be demand for it. And people will trust the token just like they trust their ETFs - because of the issuer's reputation, and the regulations and trust in the US financial system and rule of law.
The problem with pegging (aside from phrasing) is that USDT is pegged to a specific amount at all times. Pegging to a moving target seems like a great way to create manipulation opportunities.
(None of this gets to the fact that Tether and USDT is also a scam.)
ETFs also have heavy auditing and asset regulation, which is something I can't see blockchain companies going for (since that would also probably mean working within a regulatory framework that includes KYC).
What moving target? 1 share is always 1 share.
It's not the blockchain company's job, but the token issuer's. Just like with stablecoins. No difference. But instead of backing the token with USD, it will be backed by shares.
The regulations are for the issuer, not the user. Stablecoins are not subject to user KYC either.
Additional abstraction layer + no shareholded rights or dividends?
I think they meant 'scam exemption'
So you'd rather get 0.03% dividends and pay 20% capital gains tax?
The lack of interest on stablecoins is not a big deterrent either. People in horrible countries are happy to keep USDT.
Correct, id rather not participate in this quasi stock market in the hopes i can avoid cap gains tax on stocks.