How Decentralized Finance Makes Investing Universally Accessible

by visualcapitalist

Decentralized Finance

 

Historically, global financial markets have been restricted to those with exactly the right contacts, in the right locations, and with vast amounts of wealth already at their disposal. Investing for the general population, however, was typically expensive, cumbersome, and inaccessible.

Fortunately, today’s infographic from Abra demonstrates how the decentralized financial market has brought about solutions to these hurdles.

Why Investing Should be More Accessible

Many factors such as theft, inflation, and political or economic shifts can erode personal wealth over time.

Being able to invest in the global financial market offers a hedge against these risks, and yet for those with modest resources and limited connections, investing has typically been out of reach.

Consider several well-known platforms or funds:

  • Etrade ─ $500
  • T. Rowe Price ─ $2,500
  • Vanguard S&P Mid-Cap 400 Index Fund ─ $5,000,000

Investment minimums range from several hundred to several million dollars—making any hope of investing impossible for most.

This is especially urgent for the global middle class, which is expected to swell 180% by 2040. Having access to more avenues to build and protect wealth will be key to sustainable economic growth for a growing majority worldwide.

But how can people actually start investing if much of the current market is still too expensive?

Fractional Investing Offers Better Access

In the past, brokers were limited to buying and selling stocks as whole units.

Fractional investing, however, allows investors with a lower net worth to access valuable, expensive stocks. It also attracts investors that are less likely to buy and sell on a whim and instead focus on long-term growth.

Blockchain technology has been a key component in this democratization of global wealth—much like fractional investing—because people are no longer restricted by their resources, location, or lack of connections.

A New Wave of Investing

Decentralized finance is:

  • Permissionless
    Users no longer need a third-party to verify their transactions.
  • Global
    Users can access decentralized financial markets from anywhere using their smart devices.
  • Transparent
    Every transaction is made publically viewable.
  • Censorship-resistant
    No one can make arbitrary changes or cause system-wide shutdowns.
  • Programmable
    Anyone can customize smart contracts based on regional and technical requirements.

Decentralized financial tools, using blockchain and cryptocurrencies, are providing excellent alternatives to building wealth by offering smaller investment minimums, lower fees, and faster transaction times.

The rise of Bitcoin and other cryptocurrencies introduced the world to the simple concept of fractional investing—owning extremely small fractions of digital currencies.

Now, investors can also own fractions of high-priced stocks, ETFs, fiat currencies, cryptocurrencies, and stable coins, through Abra’s novel platform.

Abra: the Blockchain-based Investment App

Abra is the world’s first global investment app that uses the Bitcoin blockchain to make investing more accessible. Abra makes it fast and easy to manage your investments—all from one app.

  1. Simple: Easy to use and globally available, Abra’s app makes investing a breeze.
  2. Secure: Abra is secure and private—backed by blockchain and smart-contract technology—giving investors full control of their funds through non-custodial wallets.
  3. Fractionalized: Invest in partial shares of traditional and digital assets, starting at $5.
  4. Global: Trade, store value, and invest in a range of fiat currencies, cryptocurrencies, ETFs, and stocks from 154 countries.

The Future of Investing

Historically, investing in equities has been a key to building personal wealth, and Abra’s technology allows more people around the world to access the same types of investments, no matter their location or income.

A survey of Abra users shows the democratization of investing in action:

Affordability: Most Abra users have roughly US$50 in their portfolios.

Security: Abra users enjoy privacy of information and full control of their assets.

Accessibility: A top priority for Abra users, they are able to invest in financial markets and expensive equities worldwide.

With its intuitive, global platform, Abra has introduced the future of investing for everyone.

“For the first time, we can truly democratize access to investment opportunities at global scale.”

—Bill Barhydt, CEO of Abra

 

 

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