For the first time people around the world, including countries like China, Venezuela and Russia, will be able to hold a Swiss bank account in their pockets. With this account they will be able to access global stock and indice markets. They will be able to micro-invest in NASDAQ listed Apple stocks, buy the EURO STOXX 50 ETF and expose themselves to China and buy Moutai Kweichow stocks from the Shanghai Composite exchange. Anyone can also hedge their local hyper-inflated currency against the USD or EUR without asking their government or bank for permission.
All of the above is enabled via Bitcoin, or more precisely BTC collateralized debt. The solution provided by ABRA is similar to a contract-for-differences CFD stored and executed on the Bitcoin ledger. All assets on ABRA are synthetic assets, simulating the return of the actual investment, by means of options and securities, rather than a single conventional investment purchase. The underlying security for these CFDs is always Bitcoin. Thus, all differences in the assets value over time will be settled automatically via smart-contracts and in cash. Here, cash meaning digital and permissionless Bitcoin.
ABRA and Bitcoin will effectively enable:
- Open access to conventionally hard to reach markets
- Level access to investment opportunities for everyone with access to a internet-enabled smartphone.
- Exposure to Bitcoin with a hedge.
- Private and unregulated control over your capital without ABRA or the asset issuer even knowing who you are.
- Security of your capital locked in Bitcoin smart contracts that nobody can touch until you decide to settle it.
Currencies, Stocks and ETFs via Bitcoin on ABRA offer ultimate privacy and ultimate control. For me, this is the future of personal banking. Building on Bitcoin means that no government is able to stop ABRA from delivering the bank in your pocket, effectively leveling investment opportunities on a global scale. In the same way that the internet leveled access to information, ABRA levels access to monies. A global digital financial infrastructure that, for people who don’t understand Bitcoin, is the best gateway into collateralized digital securities, without the risk of actually holding Bitcoin. With ABRA, all of the users effectively become Bitcoin hodlers, even though they’re only exposed to the price fluctuations of the specific assets held in their ABRA portfolios.
For Bitcoin hodlers this is good news too. If ABRA is succesful and collateralizes every single asset on the global stock markets, there won’t be enough Bitcoin to underly all these investments with Bitcoin. The price of Bitcoin would have to go up consequently. The total value of all of the assets held by ABRA users through the app becomes part of Bitcoin’s overall market cap.
For the future, ABRA is even planning to turn the ABRA app on your phone into a lightning network node, ensuring the transaction fees occurring when settling in Bitcoin remain economically.
The biggest caveat to all this financial revolution is that an element of trust is required in the meantime. Investors have to trust that ABRA effectively hedges their risk exposure. ABRA has a sound track record of this so far, settling close to a billion dollars in transaction volume in over 100 countries during last year’s Bitcoin decline of 85%. “We didn’t break a sweat.” said former Netscape founder and CEO of ABRA Bill Barhydt in an interview on the What Bitcoin Did podcast.