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Ravencoin
$0.07504 -14.25%
RVN · 7w

Ravencoin — Digital Dividends?

Digital dividends are blockchain-asset dividends issued legally and 1:1 to shareholders of a public company. They have the potential to reconcile sloppy accounting and force a reconciliation with naked short sellers. How?

A bit of background. In 2015, I worked for t0 (now tZero) where I learned quite a bit about the National Market System (NMS). This was in preparation to build a platform for digital settlement. This came in several parts. One part was working out the details for a digital parallel equity. This began on a platform called Counterparty which was a pre-cursor to what is now Ravencoin. It used the UTXOs (unspent transaction outputs) to track stocks, bonds, etc. I helped build the tech that issued the first blockchain bond, and later the first digital crypto security with OSTKP.

We also built a platform that would take the slop out of short-selling and force one-to-one borrowing, or at least document it in a very public way. The platform required a blockchain entry when borrowing hard-to-borrow stocks. This system, once fully utilized, would prevent over-borrowing (double-dipping) when short selling. It was stopped.

Background: If you don’t understand short-selling, it’s pretty simple. Borrow stock, sell it right away, keep the cash, and then return the stock later by buying it back with the cash. If the stock goes down in price after you sold, you win. If the stock goes up, you lose. Until you return the shares, you have unlimited exposure as you still need to buy and return the stock. Why would you short stock? Because you think it is priced too high and you think it will go down. You can make money betting against the company.

Is short selling illegal? No! So what’s the problem? Naked short selling provides a way to manipulate the market. What is naked short selling (it sounds sexy)? It isn’t sexy. It’s selling shares that aren’t really borrowed, or are double, or triple borrowed. If it seems ridiculous to sell shares t...

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