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The reason for this is the fact that large businesses profit from being the middle-man here. Moving towards automated settlement on a blockchain reduces cost an

The reason for this is the fact that large businesses profit from being the middle-man here. Moving towards automated settlement on a blockchain reduces cost and increases efficiency,it's a win-win for everybody except the middle-man

Beldin 6y ago
Having the stock market emit 325.95 kg CO2 per transaction [1] is one of the few ways I've ever heard to make the stock market significantly worse for society -- irrespective of your current feelings about it. [1] https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/
- Scoundreller 6y ago
  There’s more to crypto than Bitcoin.
tzs 6y ago
There's nothing in fast, cheap, automated settlement that requires a blockchain. A centralized system should cost less, at least compared to a proof of work blockchain, due to energy costs. Also, stock markets are heavily regulated. In a centralized system, it is relatively easy to enforce regulations. How do you do that in a blockchain based system?
- yks 6y ago
  Blockchain is the biggest "solution looking for a problem" of our time and because it looks like we've entered the meme age, I'd not be surprised if everything was reimplemented with blockchain regardless of the fit.
  - spiralx 6y ago
    There is a massive overlap between /r/wallstreetbets, Elon Musk fan-boys and crypto enthusiasts I bet, and this mess has something for all of them: gaming, FOMO, evil short-sellers, beating the system, lots of diagrams with arrows and an app that's easy to use and easier to blame.
Grustaf 6y ago
Why would a blockchain be better than a traditional database for this? Making it decentralized is a non-goal, so what would the advantages be? The real issue is not the specific technology, it's that it's an ancient hodge podge.
- mlyle 6y ago
  No. The issue is that you have no central ledger of ownership of stock, but instead many firms' individual ledgers. You also have various kinds of risk of fraud, etc. T+2 is an atomic commitment algorithm that leaves enough time for humans to make phone calls and discuss the implications when there's going to be a failure to deliver or another anomaly from fraud or globally inconsistent state.
  - spiralx 6y ago
    It's far more centralised than you think, dematerialization isn't 100% complete but Cede and Co. hold the ledger of who owns what - at least to the extent that is possible. https://en.wikipedia.org/wiki/Depository_Trust_%26_Clearing_Corporation https://en.wikipedia.org/wiki/Depository_Trust_%26_Clearing_... https://en.wikipedia.org/wiki/Cede_and_Company https://en.wikipedia.org/wiki/Cede_and_Company
xadhominemx 6y ago
Blockchain does not do anything a database cannot. It's a pointless application of the technology.
dan-robertson 6y ago
Blockchains are about decentralisation and removing the need for trust. But neither is necessary in the case of stock settlement. If you accidentally have the DTC send someone a bunch of your shares, you politely ask that person for them back and you’ll likely get them. Try doing that with a blockchain (especially if you accidentally send them to a nonexistent address)
NovemberWhiskey 6y ago
Who do you think "the middle-man" is here, exactly?

Beldin 6y ago

Having the stock market emit 325.95 kg CO2 per transaction [1] is one of the few ways I've ever heard to make the stock market significantly worse for society -- irrespective of your current feelings about it. [1] https://digiconomist.net/bitcoin-energy-consumption/ https://digiconomist.net/bitcoin-energy-consumption/

Scoundreller 6y ago
There’s more to crypto than Bitcoin.

tzs 6y ago

There's nothing in fast, cheap, automated settlement that requires a blockchain. A centralized system should cost less, at least compared to a proof of work blockchain, due to energy costs. Also, stock markets are heavily regulated. In a centralized system, it is relatively easy to enforce regulations. How do you do that in a blockchain based system?

yks 6y ago
Blockchain is the biggest "solution looking for a problem" of our time and because it looks like we've entered the meme age, I'd not be surprised if everything was reimplemented with blockchain regardless of the fit.
- spiralx 6y ago
  There is a massive overlap between /r/wallstreetbets, Elon Musk fan-boys and crypto enthusiasts I bet, and this mess has something for all of them: gaming, FOMO, evil short-sellers, beating the system, lots of diagrams with arrows and an app that's easy to use and easier to blame.

Grustaf 6y ago

Why would a blockchain be better than a traditional database for this? Making it decentralized is a non-goal, so what would the advantages be? The real issue is not the specific technology, it's that it's an ancient hodge podge.

mlyle 6y ago
No. The issue is that you have no central ledger of ownership of stock, but instead many firms' individual ledgers. You also have various kinds of risk of fraud, etc. T+2 is an atomic commitment algorithm that leaves enough time for humans to make phone calls and discuss the implications when there's going to be a failure to deliver or another anomaly from fraud or globally inconsistent state.
- spiralx 6y ago
  It's far more centralised than you think, dematerialization isn't 100% complete but Cede and Co. hold the ledger of who owns what - at least to the extent that is possible. https://en.wikipedia.org/wiki/Depository_Trust_%26_Clearing_Corporation https://en.wikipedia.org/wiki/Depository_Trust_%26_Clearing_... https://en.wikipedia.org/wiki/Cede_and_Company https://en.wikipedia.org/wiki/Cede_and_Company

xadhominemx 6y ago

Blockchain does not do anything a database cannot. It's a pointless application of the technology.

dan-robertson 6y ago

Blockchains are about decentralisation and removing the need for trust. But neither is necessary in the case of stock settlement. If you accidentally have the DTC send someone a bunch of your shares, you politely ask that person for them back and you’ll likely get them. Try doing that with a blockchain (especially if you accidentally send them to a nonexistent address)

NovemberWhiskey 6y ago

Who do you think "the middle-man" is here, exactly?