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Author Topic: How can we trade stocks, gold etc with Bitcoin?  (Read 5139 times)
slothbag
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February 16, 2012, 12:56:40 AM
 #1

I'm looking for a way to buy sell regular stocks and precious metals using Bitcoin.  Note that I do not want to own the stock or PM, just to speculate.

What are some suggestions on how to achieve this?  Some thoughts I had..

  • New website where site operator purchases real world stocks, gold etc on behalf of customers.  Allows those already purchased commodities to be further traded by customers internally with low cost.

    - Service provider may build up a HUGE portfolio of stocks and PMs. Big liability.

  • New website having a trade matching system (Bitcoinica style), where buyers and sellers deposit bitcoins and are matched on a same commoditity and profit/losses goes to the seller/buyer depending on direction of actual stock price, PM price.

    - No actual real world stock or PM is bought.

  • Post to the forum what I want to buy/sell and just come to an agreement with another forum user on a adhoc basis.

    - Too public, wont scale?


Obviously trust will be the biggest issue, initially short term trades would be most likely as people wont want to leave money with whoever is running the service until a rock solid reputation has been built.

Thoughts, suggestions?
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Stephen Gornick
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February 16, 2012, 04:33:55 AM
 #2

I'm looking for a way to buy sell regular stocks and precious metals using Bitcoin.  Note that I do not want to own the stock or PM, just to speculate.

What are some suggestions on how to achieve this?

In which jurisdiction are you describing this to be offered?

In the U.S., of course, brokering the sale of securities (stocks and stock options) is a regulated activity.  There are today no brokers known that are accepting bitcoins as funds for use in trading.

That doesn't mean there isn't that activity occurring just that you won't see it offered publicly.  And let's say, hypothetically, a person were to do the trading through his own account for investments made by that person's family members.  That person would be the one getting the 1099 tax return (dividends, and proceeds from sales), so that can really make a mess and be costly.

[Update: a few links
 - http://www.businessdictionary.com/definition/nominee-shareholder.html
 - http://www.fatf-gafi.org/document/0/0,3746,en_32250379_32237202_46706112_1_1_1_1,00.html
]

slothbag
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February 16, 2012, 04:53:18 AM
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You are right, buying actual shares would be quite challenging for whoever is running the website.

My preference would be to not deal with actual stocks, PMs and instead just match someone who is long with someone who is short on a matching commodity and allow them to speculate in Bitcoin.

It's essentially just betting on the price, because anyone using this system wouldn't actually affect the real market price or be added to trade volume etc.


ColdHardMetal
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February 16, 2012, 04:58:54 AM
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You are right, buying actual shares would be quite challenging for whoever is running the website.

My preference would be to not deal with actual stocks, PMs and instead just match someone who is long with someone who is short on a matching commodity and allow them to speculate in Bitcoin.

It's essentially just betting on the price, because anyone using this system wouldn't actually affect the real market price or be added to trade volume etc.


You could set this up using the GLBSE:  https://glbse.com/

Matthew N. Wright
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February 16, 2012, 04:58:59 AM
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Regulated trade requires regulated currencies.

You can't legally buy stocks, bonds or securities in the USA without USD. You can have a purchasing agent buy them for you (E-trade is a purchasing agent for example) but they pay for them in USD.

ColdHardMetal
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February 16, 2012, 05:02:05 AM
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Essentially you're looking for somewhere to set up CFDs:  http://en.wikipedia.org/wiki/Contract_for_difference

Soros Shorts
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February 16, 2012, 07:10:43 AM
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How about modelling it around a gambling website where people place bets in BTC on the future marktet values of real world securities?

Otherwise, I can't see a way how you would do this without getting entangled in all kinds of regulations.
slothbag
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February 16, 2012, 11:05:58 AM
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Essentially you're looking for somewhere to set up CFDs:  http://en.wikipedia.org/wiki/Contract_for_difference

CFD's, yeah that would work.  Not sure about glbse though, its already really confusing to me without adding hundreds/thousands of CFDs to the mix.

Anyone working on a site to provide CFDs for Bitcoin? Maybe Zhoutong can whip something together in a few days within Bitcoinica Smiley

Frozenlock
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February 17, 2012, 05:59:29 PM
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The easiest solution IMO would be to use a Bitcoin as a stock - otherwise, you enter in a heavy regulated field where Bitcoin would have a hard time infiltrate.

http://frozenlock.files.wordpress.com/2011/11/master-bitcoin.pdf
markm
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February 18, 2012, 07:19:54 PM
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Since its just gambling anyway, with no actual stocks or shares or metals etc changing hands, you might as well just play the the "Insider Trading" stock / forex / commodities / etc game, and then you will be able to actually cause effects in markets because you will be able to hire terrorists to attack cities where stock markets are located and fun stuff like that if you feel that might be more fun than sitting around waiting for your blue chips to slowly go up in value or hovering over tickers all day trying to perfect code for your trading bots or just doing manually what such a bot would do if only it perfectly represented your style and instints and ... insider connections with the folk who actually run the nations whose currencies you use to buy the stocks and commodities and hire the terrorists or pay the shipping to strategically move commodities or whatever...

-MarkM-

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Free website hosting with PHP, MySQL etc: http://hosting.knotwork.com/
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March 27, 2014, 06:32:27 PM
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BUMP - Is there anywere to trade BTCs for shares such as Candy Crush?
JPage
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March 27, 2014, 07:02:50 PM
 #12

I'm looking for a way to buy sell regular stocks and precious metals using Bitcoin.  Note that I do not want to own the stock or PM, just to speculate.

What are some suggestions on how to achieve this?  Some thoughts I had..
Thoughts, suggestions?



Essentially you're looking for somewhere to set up CFDs:  http://en.wikipedia.org/wiki/Contract_for_difference

This is actually being built right now over at Mastercoin as one of the bitcoin 2.0 functions.  You'll be able to do these contracts in less than one year.  Their Distributed Exchange is already up and running.  Although the exchange only includes BTC and MSC now, it will soon support those 'regular stocks' soon.  Just hold tight another 6 months.  Its coming.
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March 27, 2014, 07:57:24 PM
 #13

I have some great news - something that will allow you to do this is coming, and is almost in beta. You don't know who I am yet but we will be posting announcements soon asking for beta testers within 30 days. I will PM you directly, and anyone else who is interested as the platform will offer speculation on stock prices.

The scope is slightly different than what you're describing though, which is actually something I will be working on as a separate service after our launch coming up probably next month. The setup I envisioned is your 2nd variant, where there are 2 separate entities, the first one accepts bitcoin as payment for a 'virtual stock' tied to your account, and a separate, offshore entity hedges through real money, essentially mirroring the bitcoin orders. And yes, the problem is it requires a lot of capital as you can only sell the stocks you have off book. We have a VC on board though so give us a few more months. That is unless you're totally satisfied with what we will be launching next month. Smiley

Cheers

BetMoose.com - Wager on real world events. Profit from predicting the future. Create and share your own contracts.
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