Blockchain, a distributed ledger technology created by the mysterious Satoshi Nakamoto, has proven to be effective, secure and a game-changer when it comes to data exchange and security. Yet, blockchain technology’s potential is vastly untapped.
Nearly every type of digital token or coin in the market is traded as a medium of exchange, but one platform, CDRX, has ventured into a field where it completely changes the outlook of crypto tokens.
Equity, Shares, stocks, different names of the same thing in different jurisdictions, is the ownership (partial or whole) of an underlying asset. The market, with a 77.7 trillion US Dollar traded in 2017, is one of the largest in the world.
For such a huge market where timely selling or buying of shares can make all the difference, the financial industry has adapted itself, integrating technology to speed up the trades and transfer of ownership and money. However, the basic principles of trading in stocks has not changed significantly. This means that even with adapting faster and efficient technologies, inefficiencies do exist.
The regular advantages of blockchain technology, such as speed, security, efficiency, low cost and elimination of intermediary are a game changer in the financial market. CDRX is a platform which offers every little advantage that blockchain has to offer.
The platform goes beyond that, however. Exploiting characteristics of blockchain is one thing, but the creation of a tradable secondary security, that opens the doors of trading and financial market to small investors and ordinary people, who previously could not participate in the trading industry due to high value of stocks, sets CDRX apart.
ADRs, CDRs and Crypto Shares
A negotiable security, American Depository Receipt is a collection of shares and stocks that can be traded in the US financial markets. The ADRs are typically scrutinized and held by a domestic depository banks. The beauty of ADRs is that unlike shares themselves, it can represent a single share, multiple and even fractional ones.
The fractional share holding is a real beauty about depository receipts. For companies whose shares are very costly, like Apple and Amazon, owning a single share can be sometimes out of the range of retail investors. Through ADRs, they can obtain a secondary security that represents a fraction of a share of a traded company.
Crypto Depository Receipts, or CDRs, are the blockchain equivalent of ADRs. A natural evolution of traditional equity ownership, CDRs offer all the advantages of traditional stock ownership and (through the efficiency of blockchain) possess none of their disadvantages.
Crypto shares are digital forms of the shares themselves. Instead of issuing a paper declaring the ownership and rights of a shareholder, crypto shares are digital tokens on a blockchain representing the same data.
Unlike Crypto Shares, CDRs are not directly shares themselves and represent a collection (whole or partial) of actual physical shares. This means that in contrast to restricted tokens in the market, CDRX offers a solution that is not only aligned with the current rules and regulations but also deliver cost effectiveness and hold benefit to issuer and investor, alike:
- Transaction Costs: With direct transferring of CDRs from one party to another, the heavy commission taken by brokers is virtually eliminated.
- Dividends: Issued through dividend tokens that are integrated into the CDR through smart contract, the dividends are paid out automatically.
- Voting: Smart contracts in the CDR token mean voting is easy and efficiently conducted.
- Speed: Updates on the register (blockchain, instead of traditional central register), happen automatically and in real time.
- Transparency: Since blockchain is made public, all transactions are available for investors to review.
- Immutability: With the hard writing of data on the ledger, there is no chance of tampering of data, making investments secure.
- Floating Costs: With digital CDRs, floatation costs (which are normally so high that they are incorporated in the cash flows of companies) are eliminated.
By harnessing the power of blockchain, CDRX drastically reduces the transaction costs, administration, settlement time and cut down on most of the corporate actions that simply cause delays. Voting and announcements will be handled through smart contracts and fractional ownership means small scale investors, who are not able to participate in the traditional market, can now have a chance to own a fraction of stock, such as Apple or Amazon.
CDRX, as a trading platform, will be running its own exchange system with crypto to crypto trading pairs. The platform has plans for expanding the services of the exchange into crypto to fiat trading as well. This means retail investors would be able to buy or sell CDRs with ease. The platform will also allow for easy conversion of equity issuance into CDRs, new issuances of CDRs and even crypto shares.
The exchange will have a high speed of settlement, issuance, transfer than any other financial trading platform that deals in securities and stocks, giving the traders the edge over all others.
Visit the CDRX website for more information: https://cdrx.io/