Abra App Allows Users To Buy Apple and Facebook Shares Using Bitcoin
Abra, a platform that seeks to make investing in crypto simple, has launched a new service that enables clients to invest in traditional assets such as top stocks, or in exchange-traded- funds ( ETFs), using bitcoin.
The new Abra app offers its clients the opportunity to access 30 crypto investment options, with investors able to use both fiat and cryptocurrencies to buy their preferred assets.
With up to 50 new traditional stock asset offerings, Abra gives clients the opportunity to buy into top tech market assets like Apple, Google, Facebook and Amazon (together with Netflix they become the famous FAANG stocks).
Users can also purchase investments in commodities such as the tradable SPDR Gold Trust. Others include Exchange Traded Funds -Vanguard Growth and S&P 500.
The non-custodial wallet provider said that early investors will have the added benefit of accessing the service at zero fees.
In order for clients to invest in stocks and ETFs, they will use Crypto Collateralized Contracts (C3s), an investing model developed by Abra. With the help of the model, users can choose to buy their preferred assets, choosing from the over 50 options available that will be represented via bitcoin and smart contracts.
It should be noted that the new service does not mean an investor becomes a shareholder in the company whose shares they buy, or in whose ETF or commodity they invest. The investor gets a bitcoin representation of the asset and tracks the performance of the investment.
The investment requires clients to have enough funds in their accounts so as to buy the offered stock as per the market price. The buyer’s cash is thereafter converted into bitcoin instantly by the investing model, C3. Using a smart contract, the Bitcoin’s total value is then tied to the exact price of the stock or other assets an investor buys.
The bitcoin balance of a given user is maintained through the app as determined by price changes. Change in the stock price in an investor’s assets determines the number of bitcoins Abra will increase or reduce from the total investment of the user.
This can be explained in the sense that in a case where an investor using bitcoin purchases $1000 worth of Apple, they are legible for gains when Apple’s price climbs; meaning an increased number of bitcoins. The bitcoin balances will be reduced if the price were to decrease.
While not about using bitcoin for payments, the Abra service could see an increase in the number of people seeking to hold crypto and invest in traditional stocks- especially in tech stocks.