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A US public company can do the same thing in terms of their authorized stock vs their shares outstanding. You can print money without it being backed. This mean
by KasianFranks 9y ago
A US public company can do the same thing in terms of their authorized stock vs their shares outstanding. You can print money without it being backed. This means increasing your 'authorized' as you see fit. Just get approval from the SEC/Finra and your buddies and you're good to go. Now lets talk about other organizations printing money that's not backed by anything e.g. the Fed, QE 1-4, countries with inflationary problems. Cryptocurrency offers far more transparency (as we can see here) and has true global reach. This FUD needs to stop and more effort needs to put into understanding financial engineering and it's importance and relation to software engineering.
- jhwang5 9y agoI think you should look up how stock dilution works, how that typically destroys share prices, etc. I would like to suggest learning how finance works, starting from Investopedia /s
- davidbanham 9y agoIt would destroy the issuing company in a similar way that Tether refusing to pay out would destroy them. The analogy holds.
- jhwang5 9y agoYeah - I agree it's a ticking bomb - hasn't exploded yet, though.
- goldenkey 9y agoThe later authorized and issued shares are NOT considered equal to the initial class A shares. Here's a tutorial on the difference between class A shares, class B shares, and so on... https://www.delawareinc.com/blog/change-your-companys-number-of-authorized-shares/ https://www.delawareinc.com/blog/change-your-companys-number...
- KasianFranks 9y agoHere's a free tutorial on the way things really work as we're not talking about classes of shares, were talking about aggregate issuance: https://news.ycombinator.com/item?id=13844765 https://news.ycombinator.com/item?id=13844765 - we talk talk about "golden shares" and Yandex http://old.themoscowtimes.com/business/article/tmt/384137.html http://old.themoscowtimes.com/business/article/tmt/384137.ht... among other things.
- goldenkey 9y agoThank you. Those links were informative. However, with extra shares authorization and in the Yandex golden ticket case, shareholders/the board, voted to go ahead with those dilutions. This is quite different from a centrally controlled coin where the users are really just hoping for "good will" more than anything. No matter what, you would expect those who have a stake, to want to increase the worth of that stake. Problem with crypto is...they dump and no one finds out until later. And once they dump, they could care less about upholding the value through good management. For example, Charlie Lee, pumped then dumped LiteCoin just last week. Literally sold all of his coins. The price crashed hard. Now he can care less.