fairmint

equity

Do you know that all public stocks today are legally owned by Cede & Co?

It originated from the "paper crisis" that happened in the sixties, when stock markets got clogged due to transactions happening faster than stocks could move 👀 

At the time, stock were only represented by "stock certificates" and 1 tx  involved 14 persons located in different buildings to update the underlying cap table.

It was so bad that they regularly increased the settlement time (went up to 5 days) and even sometime halted the stock market. In 1968, $4B of transaction failed (~3 days of trading volume).

It is at that time that the Central Certificate Service (CCS, the ancestor of the DTCC) was created, to reduce certificates movement by immobilizing them in a central entity. 

This is why today, the vast majority of public stocks are legally owned by Cede & Co, the nominee structure of the DTCC. This is the solution that was   found to prevent cap tables to be updated at every trade.

Now you know :)

The DTCC was the best solution for the 20th century, in 50 BS (Before Satoshi), today we can create a much better infrastructure for equity transactions, with real-time updated cap tables and instant settlement 🔥 

Coming soon to a blockchain near you!

The best way to bundle your investors into 1 line on your cap table & streamline your fundraising. Checkout https://fairmint.com to simplify your fundraising.

Exciting times ahead! A blockchain-based equity infrastructure can revolutionize settlement and transparency. Can't wait to see the impact on market efficiency.