The PayBito chief exposed drawbacks in exchange broker models, and proposed a solution to revamp financial inclusion & brokerage democratization with the BaaS cloud brokerage model.
PALO ALTO, Calif., March 7, 2023 /PRNewswire-PRWeb/ -- PayBito CEO Raj Chowdhury voiced his dissent on the negligence in upgrading existing brokerage models by all major exchanges across the world. Their abstinence from cloud integration hinders the evolution of brokerage services. This denies equal opportunity access to broker-dealers services and creates financial exclusion at large.
Stone-Age Architecture in the Internet Era:
The PayBito chief pointed out key drawbacks in exchange models preventing an open market for brokerage services. The limitations include:
- Cloud Denier in its Core Business Model
Popular exchange broker models lack Quick Sign-up and Brokerage as a Service (BaaS) features as they do not use cloud-based SaaS solutions. Intermediaries across the largest global exchanges need to host platforms, consisting of complex components and server hosting before offering their services. The existing process is thus time-consuming and expensive, while contributing to financial exclusion.
- Impedes Financial Inclusion
The membership registration process is not open for all. Brokers need to work under registered institutional members. Prohibitive eligibility criteria restricts retail brokers from establishing a new business.
- Cost Restrictions
Backdated broker platforms incur high installation costs. As per services, NASDAQ membership charges may range from $5000 to $500,000. This limits newcomers.
- Time Constraints
The enlistment process is cumbersome and time-consuming for brokers. Registration comprises several hassles, and has a waiting period of at least 6 months in the world's second largest exchange.
- Lack of Transparency
Exchanges are rife with transparency controversies. Their brokerage models are often opaque in terms of pricing and execution policies. The actions of market makers are often difficult to grasp for investors. This deprives them of a chance to leverage the best market deals.
- Protection of Institutional Investors
Unethical practices by market makers across the exchange platform are not uncommon. Global exchanges have settled heavy fines several times for illegal transactions and market manipulation. The accused institutional traders are also penalized, but not stripped of their membership. A clear bias and immunity exists for enlisted firms. This includes the ones engaged in insider trading and other illicit activities.
BaaS-Ruption: Preparing for the Space Age:
Chowdhury further stressed why change is critical, stating, "Remodeling and democratizing brokerage as a service architecture (BaaS) transforms the global financial landscape, serving countless buyers and sellers while empowering intermediaries."
The PayBito head put forward his viewpoints in addressing the NASDAQ limitations, and presented the following solutions:
- Cloud Assimilation Across Brokerage Platforms
Cloud integration allows exchanges to provide instant affordable brokerage access to all. Broker platforms like PayBito are built on the Brokerage as a Service concept. BaaS advocates incorporation of cloud and modern innovations. It also transforms the perception of intermediation, making it viable for retail participants.
- Promote Financial Inclusion
Making brokerage services scalable and inclusive is the need of the hour. Exchanges must update their brokerage models and ensure service accessibility to all. This means removing complexity- zero coding, server hosting or technical integrations. Mainstream adoption also requires significant lowering of high setup or installation costs.
- Make Pricing Affordable
The internet age values cost-effectiveness and variety. PayBito provides comprehensive brokerage service offerings for a monthly subscription of $49.99. Registered participants can also avail acclaimed white-label solutions to build their own brand.
- Offer Rapid Registration
Modern broker platforms can complete the entire registration process in 3 minutes. PayBito-enlisted brokers also offer many trading options, customization, crypto-powered banking and custodial services.
- Use Technology to Increase Transparency
New-age platforms can integrate blockchain in their brokerage architecture. The distributed ledger technology (DLT) optimizes accountability and transparency. Fast transaction processing further empowers clients in leveraging the best business deals. Cost and execution policies are easy to understand with comprehensive pricing schemes.
- Democratize Brokerage Services
Democratizing brokerage services is ideal for tackling unethical practices by institutional investors. This promotes fairness, transparency, and regulation, and limits the risk of financial crises. Empowering retail investors with real-time market data, AI-enabled insights will reduce insider trading. Additionally, more competition will deter market manipulation, increasing oversight and scrutiny.
Evolution: Balancing Stability and Sustainability:
Disruption emerges wherever human needs drown, restrained by exclusion and favoritism. The biggest global exchanges have aligned with institutional brokers, alienating retail intermediaries and newcomers. Brokerage democratization through cloud integration is essential for the next revolution. Platforms can also use modern tech innovations for social welfare. The Brokering World Hunger Away movement was forged with a vision to reduce child hunger. Similar committed initiatives will lead to better sustainability.
About Raj Chowdhury:
Raj Chowdhury is the Managing Director of HashCash Consultants and Paybito. Raj pioneered the first interbank Trade Finance and Remittance implementation of Blockchain Technology between two of the largest global banks. Raj is an eminent voice in the Blockchain and Cryptocurrency space and actively engages with policymakers in this area. He is a contributor to Economic Times, Business World, CNNMoney and advises industry leaders in the adoption of Blockchain. He is a member of Asha Silicon Valley, a nonprofit committed to education for children in emerging countries. Author of the book 'The Dark Secret of the Silicon Valley', Raj is an investor in blockchain and cryptocurrency companies and an active member of the philanthropic community.
Media Contact
Coleen Facete, Hashcash Digest, +14159662907, [email protected]
SOURCE PayBito
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