Jun 25, 2021
Controlling your shares on Upstream versus other blockchain exchanges
Maintaining control of your assets on Upstream’s exchange and trading app using blockchain technology
By Vanessa Malone
Upstream, the Horizon-powered exchange and trading app for digital securities, is built using Ethereum blockchain technology.
On the surface, Upstream offers global investors a real-time, secure, and intuitive trading app. Under the hood, Upstream introduces what we believe to be the future of trading featuring some of the highest levels of transparency, accessibility, and investor protections using blockchain technology.
These innovations include taking traditional equity and converting it to tokenized equity, and executing best bids and offers on a public orderbook.
On top of these next generation features, we execute on what we believe to be one of the biggest advantages of blockchain technology; empowering traders with the tools to truly and conveniently control their own assets.
The current blockchain trading ecosystem
Something counterintuitive about the growth of blockchain technology thus far, a technology built on the principles of decentralization, is that many of the applications surrounding it have become increasingly more centralized.
Many of the popular blockchain-based trading venues today are centralized, private, or off-chain, which we believe not only contradicts a core blockchain founding principle, but takes away from the true power that operating on a public blockchain can harness.
A blockchain is a decentralized, distributed ledger which enables people to transact directly with one another. It removes the need for a “centralized,” trusted authority.
Contrarily, a centralized exchange utilizes a middleman to conduct transactions on behalf of a user and hold a customer’s assets. It’s ironic because this requires traders to put their trust, and private keys, in the hands of a central authority.
The problem is that whoever controls the private key controls the assets. You are entrusting that company to keep your private keys safe with whatever measures they choose to implement. A quick Google search will demonstrate why centralized mass storages of private keys and valuable assets are severely prone to attack.
How we empower investors with their private keys
As evident in the volume of trading, users are willing to give up complete control of their assets in exchange for convenience. So how do we get back to the core principles of blockchain and fintech as a whole?
We believe the answer is to make a more convenient alternative, and is why we hope to lead the transfer of financial control back to the individual in a userfriendly manner on Upstream.
On Upstream, investors will be able to trade shares in IPOs, crowdfunded companies, US & International equities, SPACs, celebrity ventures, and other unique asset classes using digital currency in the form of USDC and traditional bank payments.
We support a ‘non-custodial’ environment, where the individual maintains complete control of their assets and their movement instead of electing to have a central entity move the assets on their behalf.
During the KYC onboarding process, we create a “key pair” in an encrypted file that is saved to your Keystore. A Keystore is a way of storing a password protected file that contains your public and private key, together this makes a key pair. A great way to think about your private key is like a pin code to your ATM card. Unlike centralized exchanges, Upstream will never know your private key.
Conveniently, we hide all the blockchain security and sophistication behind a simple, yet incredibly secure interface. To transact on Upstream, we make your private key unlockable using your verified biometrics. Every time you transact you sign using your private key. A timestamp of this record is logged on an Ethereum layer 2 rollup blockchain to maintain a transparent and protected ecosystem.
Why this evolution matters
Ethereum is at the forefront of fintech, powering what we believe to be the next paradigm shift in finance: an ecosystem that meets the demand for accessibility, transparency, and security while returning financial ownership to the individual.
Our brand new site for Upstream is now live! Visit us at https://upstream.exchange/.
About Upstream:
Upstream, a MERJ Exchange Market, is a fully regulated global stock exchange for digital securities. Powered by Horizon’s proprietary matching engine technology, the exchange will enable investors to trade shares in SPACs, high-growth startups, and other unique asset classes directly from the app: https://upstream.exchange. Interested issuers can reach the team at hello@upstream.exchange.
About MERJ:
MERJ Exchange operates Upstream as a fully regulated and licensed integrated securities exchange, clearing system, and depository for digital and non-digital securities. It is an affiliate of the World Federation of Exchanges, recognized by HM Revenue and Customs UK, a full member of the Association of National Numbering Agencies, and a Qualifying Foreign Exchange for OTC Markets in the U.S. MERJ is also a member of the Sustainable Stock Exchanges Initiative.
About Horizon:
Horizon is a fintech company that builds and powers global securities exchanges with an integrated suite of software for compliant issuance, management, and secondary trading of securities. Our in-house solutions combine Wall Street and Silicon Valley to power the next generation of securities offerings and trading in the U.S. and globally: https://www.horizonfintex.com/.
Disclaimers:
Upstream is a MERJ Exchange market. MERJ Exchange is a licensed Securities Exchange, an affiliate of the World Federation of Exchanges and full member of ANNA. MERJ supports global issuers of traditional and digital securities through the entire asset life cycle from issuance to trading, clearing, settlement and registry. It operates a fair and transparent marketplace in line with international best practice and principles of operations of financial markets. Upstream does not endorse or recommend any public or private securities bought or sold on its app. Upstream does not offer investment advice or recommendations of any kind. All services offered by Upstream are intended for self-directed clients who make their own investment decisions without aid or assistance from Upstream. Customers must comply with applicable law of their own jurisdiction. By accessing the site or app, you agreed to be bound by its terms of use and privacy policy. Company and security listings on Upstream are only suitable for investors who are familiar with and willing to accept the high risk associated with speculative investments, often in early and development stage companies. There can be no assurance the valuation of any particular company’s securities is accurate or in agreement with the market or industry comparative valuations. Investors must be able to afford market volatility and afford the loss of their investment. Companies listed on Upstream are subject to significant ongoing corporate obligations including, but not limited to disclosure, filings and notification requirements, as well compliance with applicable quantitative and qualitative listing standards.
THIS BLOG SHALL NOT CONSTITUTE AN OFFER TO SELL SECURITIES OR THE SOLICITATION OF AN OFFER TO BUY SECURITIES IN ANY JURISDICTION WHERE SUCH OFFER OR SOLICITATION IS NOT PERMITTED. U.S. INVESTORS ARE NOT PERMITTED TO TRADE IN UPSTREAM LISTED SECURITIES.
