In a bid to democratize access to investing, traditional financial institutions are urged to embrace digital assets for new use cases, particularly in the realm of equities. Mike Cahill, co-founder and CEO of Douro Labs, highlights the disparity in wealth-building opportunities globally, with the top 10% of earners in the US owning more than 90% of all stocks. The solution lies in injecting decentralized technology into the pricing, execution, and settlement of equities to make them more accessible worldwide. Traditional equity markets are often exclusive, with pricing data kept behind paywalls and limited to a select few. This lack of access perpetuates the narrative of the rich getting richer while hindering everyday investors from participating. The cumbersome settlement systems further deter smaller investors, locking up capital and perpetuating elitism in equities trading. However, decentralized finance (DeFi) offers a solution by reimagining the infrastructure through technologies like synthetic equity markets, tokenized private equity, and equity-based prediction markets. The collaboration between DeFi and traditional finance presents an opportunity to revolutionize the financial system, promoting equity, access, and transparency. Decentralized price feeds provide real-time data at a fraction of the cost, while execution platforms enable fractional trading and smart contract automation. Settlement in DeFi is almost instantaneous, eliminating intermediaries and reducing counterparty risk. By leveraging decentralized innovations, equities can be disrupted entirely, bridging the wealth gap and offering opportunities to billions worldwide. This shift towards a more inclusive financial system is crucial in closing the gap that currently leaves many at the mercy of a privileged few.
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