Abra is expanding beyond cryptocurrencies. The exchange and wallet provider has announced that it is adding access to collateralized equities, giving its customers in 155 countries the ability to trade in a number of U.S. stocks, exchange-traded funds (ETF) and commodities. In addition, those customers can even use their crypto holdings to conduct trades.
While the platform will support only certain U.S.-based trading products at first, Abra indicates that it will eventually offer other global assets within the next couple of months.
According to Abra CEO Bill Barhydt, “Many consumers in the US and other countries already have access to stocks and mutual funds via online brokerages. However, many people (billions actually) are shut out of these investment opportunities due to their geography, financial status or lack of accredited investor status, income level, or lack of trust for their local financial institutions. That’s why Abra is leveling the playing field for everyone. At Abra, we already have low-income families in the Philippines and rich venture capitalists in the US using our app to invest in cryptocurrencies. Now we’re giving our customers access to the same investment products that everyone in the US has enjoyed for decades.”
Out the gate, 50 assets will be supported, among which are Apple, Amazon, Facebook, Netflix, the Vanguard Growth ETF and the S&P 500. Additionally, the Russell 2000 and the SPDR Gold Trust are to be available.
Abra is employing a “crypto collateralized contract model” to make the trading possible. That, explains Barhydt, is the same model used by the exchange for its digital assets and allow investors to access any asset by using crypto as the medium of exchange for the investment.
The formula is a little risky given the possible volatility of the markets. However, Barhydt says that the company is willing to take the risk, adding, “…Abra hedges away our risk on these contracts in the open market at the moment the consumer creates the investment. Abra has already successfully processed hundreds of millions of dollars’ worth of these investment contracts and has never lost money on them.”
The minimum investment is $5 and early access is now available on the company’s website. In order to boost response, Abra says that it will not charge trading fees for the rest of this year.
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