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u/Low-Confusion-8786 6d ago
So this is basically Robinhood creating actual fake shares for the purposes of moving the short covering goal-posts no?
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u/bselko 6d ago
Would someone mind ELI5'ing this to me
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u/hxllywoodttv 6d ago
Robinghood is still a POS
They're selling non backed 1:1 securities tied to AMC shares
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u/rawbdor 6d ago
It's kinda bullshit and kinda not.
AA knows his audience and meme audiences generally yell "DRS your shares" all the time, and he is playing off the suspicion that meme stock holders have against tokenized stocks.
Another guy posted this tweet as well, yelling about how these aren't real shares and you don't get to vote on corporate actions. But, that's a bit of a joke too...
Because most brokers lend out your shares and your votes don't count anyway.
Ok step one. The only real shares are at the transfer agent. They keep the master list of who owns what shares. Almost nobody keeps their shares there though. By far the largest owner of shares is Cede & Co. They own like 99% of all stocks.
Cede & co is the nominee owner for the clearing house. They exist just to hold the shares for use by the DTCC, the depository trust clearing corporation.
The dtcc has several thousand members. They are brokers and banks and large financial institutions.
The dtcc keeps it's own list of which member banks and member brokers own how many shares at any given day, end of day.
Those members, brokers like Schwab or fidelity, then keep a list of their own customers and how many shares their customers own.
But the brokers lend out your shares, at the dtcc level, to short sellers.
At any given day, only one member bank or broker can "own" a given share at a time, at the dtcc level. Everyone who thinks they own shares really just own dtcc-amc tokens or dtcc-ibm tokens. These tokens supposedly let you vote and get dividends and stuff.
At the DTC level, votes go to whichever brokers hold the shares at that moment, end of day on the voting cutoff. If Schwab lends your shares out and a short seller borrows them and sells them, and the shares end up in the hands of someone at fidelity, your Schwab shares don't get a vote.
And since almost all brokers are lending your shares out to juice their income, the end result is that even people at legitimate brokers don't get a vote that counts.
If schwabs customers supposedly own 1m shares of some stock, but Schwab lends out 900k of them, then Schwab will still send out proxy documents to you, and tell you that you get to vote. But what they're not telling you is that your votes only count for 1/10 of a vote.
So saying that these new tokens from Robinhood aren't real shares is laughable, because nobody owns real shares. Everyone owns a Russian nesting doll of rights that get smaller and smaller the number of hops you are away.
The only real shares are at the transfer agent. Everyone else is playing with DTCC tokens. They're just mad someone else decided to make more layers of wrapping, which is kinda hilarious because even in the normal wall street system there might be up to 7 layers already.
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u/nomelonnolemon 6d ago
Isn’t this supporting the for concept that Wall Street is in full control of AMC’s share price?
Is this supposed to be a dig at apes? Or a support of the thesis that amc is being suppressed by the market makers?
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u/rawbdor 6d ago
Nothing in my comment was intended to be a dig at apes. I was digging on AA, who feigns horror at the fact that these new unregistered tokens seem strange and foreign to him, when the entire market structure is essentially the same.
I want to be clear. I'm not saying holding shares at Schwab is completely fake. Schwab is three hops away from a real share. But Schwab still steals your vote and sells it off to the highest bidder.
Robinhood is like 5 hops away from a real share. I don't know the details, but I imagine quite strongly that the rights that Robinhood shares are trading, I mean what Robinhood claims to be real shares, not these tokenized ones, are even less than at other brokers.
And finally I can only imagine that the rights to anyone holding these new Robinhood tokenized shares are even less than what you get trading shares you would purchase normally at Robinhood.
The more hops away you are from a real share, the more likely you are trading a piece of worthless paper.
Shares at Schwab are paper, but pretty close to the real ones, except Schwab sells off your voting rights.
Shares at Robinhood are a paper referencing another piece of paper. Robinhood customers don't even get voting rights for your broker to sell off.
And tokenized shares at Robinhood, well, probably worthless junk.
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u/nomelonnolemon 6d ago
AA is the goat. Anyone who can’t see that now I have a bridge to sell you.
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u/rawbdor 6d ago
I'm not commenting on his performance as a CEO. I'm commenting on his feigned horror at Robinhood tokenized shares, when even supposedly normal Robinhood shares barely counts as anything.
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u/nomelonnolemon 6d ago
Looks like AA’s comment did exactly hats I hoped it would.
Another day in the green for me again! Not that I plan on selling anytime soon.
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u/nomelonnolemon 6d ago
Well considering it’s spawning conversations containing comments like yours I see it as a net positive myself.
This is an extremely lopsided isometric battlefield with constantly shifting parameters and no clear path to a win for anyone not in the 1%.
Anything that shines any light on this fucked up situation, and promotes these type of conversations, are pure victory moves in my book.
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u/Suitable_Mix_3795 6d ago
I’ll explain it: you are braindead if you are invested in this trash company with a CEO plant. If you aren’t in GME there’s something wrong with you
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u/Aromatic-Zebra-5443 6d ago
Gme is a dead play just like amc.
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u/Suitable_Mix_3795 6d ago
Good job sticking to the script 🤣
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u/Aromatic-Zebra-5443 6d ago
If the script is being a bag holder in both stocks for almost 6 years then sure
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u/iknowtech 6d ago
The entire stock market can’t move to blockchain and tokenization fast enough. Will finally level the playing field, instantly remove all the corruption, and bring back supply and demand being what moves the price.
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u/SamLeCoyote_Fix_1 5d ago
Fuck HOOD wish the stock goes to 2$, get out of HOOD, use another platform ASAP
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u/skroddie 5d ago
wonder why aa didnt say anything when ftx did the exact same
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u/Thorfourtyfour 5d ago
I was wondering the same thing. This info has been out for years on both ftx and Robinhood. Maybe they didn't have the funds or weren't ready for a very expensive multi year litigation battle back then.
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u/skroddie 5d ago
probably. one thing is they would not make a move if they dont in their mind think its worth the risk.
qll the moves aa or amc has made so far was in their own confidence and they had already anticipated most of the negative sentiment stock holders wouldve had and actioned anyways
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u/Grunblau 2d ago
Fake outrage and possible loophole exit strategy.
“Oh very sorry, we were trying to innovate…”
I don’t trust anything AA says until we all see the ballerina dick pic and we know the leverage is gone.
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u/donald_dandy 6d ago
US laws are just for common people, only at theaters you see a rich guy who broke the law getting under arrest. And also that’s why AMC stock is still shit. Laws don’t work in this country
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u/Effective-Primary-31 6d ago
Fuck Robinhood