By Michael P. Regan
For years, the powers that be on Wall Street have toyed with questions about whether it would be feasible to move the stock market onto a blockchain, the underlying technology behind cryptocurrencies.
The innovators in the fast-moving world of decentralized finance — or DeFi — aren’t waiting around to see how those discussions unfold. Instead, they’ve built synthetic versions of equities that track some of the world’s biggest companies. In essence, the anti-establishment ethos of the crypto world is being applied to a rough facsimile of the stock market.
Fake versions of Tesla Inc., Apple Inc., Amazon.com Inc. and other big stocks, as well as a few popular exchange-traded funds, have been created by the projects Mirror Protocol and Synthetix over the past year. The tokens, and the programming that allows them to trade, are engineered to reflect the prices of the securities they track without any actual purchases or sales of the real stocks and ETFs involved. So far, volumes are just a tiny fraction of those on regulated exchanges. But for crypto enthusiasts, the potential upside is huge.
The synthetic shares join a strange new world of assets such as digital artwork and highlights of NBA games now trading on blockchains. Yet, unlike the modern…
