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You can finally trade traditional shares on a blockchain!
It is thanks to “xstocks”, the new tokelized stock products have been brought to you by crackon and supported finance (and soon Robinhood).
24/7 tradeInstant settlement, tokens for tokens with decentralized finance, dividend payments flow directly into your wallet and – the best – a legal claim on the underlying stock.
Good! Maybe my mother finally understands the industry that I work.
But wait… there are nuances.
Any person with wallet can buy xstocks on Solana, yes.
But only qualified, KYC’D, Non-US Crackon Investors will be able to collide and capitalize on the underlying tokens xstocks.
This is because each asset supported is excluded from a lichetteente-domicild SPV (special purpose vehicle). The SPV purchases (or sells) on a regulated exchange during the hours of the US market after mint or burn request.
It takes us the problems of liquidity and value peg with token stock.
Stock trade Monday to Friday, 9:30 am to ET to 4 pm
But token stock business 24/7.
While the Wall Street is open, a primary-market arbitration leads to cash value to the xstocks.
What happens to the peg when trading day is closed?
If Tesla ends at $ 300 on Friday and the hand changes at Tslax $ 290 on Sunday, the price convergence is only when someone is ready to burn tokens for shares after the market reopens.
But since market manufacturers cannot fill on Sunday until the bell rings on Monday, they will have to protect themselves from broad proliferation and small size quotes as Rob Headic of Dragonfall Capital. told In an excellent tweet.
It is somewhat echoing by Wintermute CEO Evageni Gavoy, who Believes The market manufacturer “usually not the biggest fan of providing liquidity on AMM, walk alone on the weekend.”
This will probably not matter so much for small trades. But the current deficiency of liquidity reduces the value proposal of token equity.
You can play around Bupeter How to see yourself how a six-end business will eat high value impact up to a triple-design BPS.
The silver lining is that the equity is much less unstable than the crypto, so perhaps some market manufacturers will be ready to stomach that risk.
But until these issues get better, you can probably get a much better execution and cheap delta exposure with synthetic papers using osteium, a pex dex on the intermediary that I have touched before.
Osteum co-founder, Kalendora Linen, Note Opening $ 250K TSLA position through the synthetic perps of osteium is almost 100x cheaper that you will now pay for a token stock.
The only trade closure is that the synthetic property of the osteium does not enjoy the same capital efficiency of the token stock (because they are tokens!).
Now you can put your token shares on a money market like a comeino and borrow Stabecrims against them.
It is unclear whether Robinhood will enable that composibility, though.
An initial glimpse under the hood (thanks Rain of electrical capital) Robinhood token stock contracts reveal the requirements of KYC/AML checks that limit transfer to approved address.
We have to wait and see.
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