Introduction to the Stock Market from a Web3 Perspective: Analysis of Listed, OTC and Emerging Stocks

What are listed and over-the-counter stocks?

listed stock

• Stocks issued on the stock exchange
• Investors obtain partial ownership of the company by purchasing.
• Listed companies must meet strict standards and regularly disclose financial information.
• Similar to large token projects on mainstream blockchains

OTC Stocks

• Stocks traded on the exchange at the counter
• Trade through inventory held by brokerage dealers
• The OTC companies are smaller in scale and do not meet the listing requirements of the exchange.
• It can be compared to smaller blockchain projects or emerging tokens.

Stock Trading Places for Listed and Over-the-Counter Stocks

listed stocks

• Trade on centralized exchanges (CEX)
• The trading mechanism is similar to that of certain mainstream CEX spot trading.

OTC stocks

• Trade in the market at specific counters
• The US stock market mainly consists of three markets: OTCQX, OTCQB, and Pink.
• The trading model is similar to the liquidity pools of decentralized exchanges (DEX).

Comparison of Listing and OTC Application Conditions

listing conditions

• Taiwan stock market: Established for more than 3 years, with a capital of over 600 million, etc.
• US Stocks: The requirements of the NYSE and NASDAQ differ, including indicators such as the number of shareholders, stock price, and market capitalization.
• Analogy: The strict review standards for launching large token projects on mainstream CEXs.

Listing Conditions

• Taiwan Stock Exchange: Established for 2 years, with a capital of over 50 million.
• US stocks: Lower requirements, mainly submit relevant documents.
• Analogy: The relatively lenient requirements for listing emerging tokens on small CEX or DEX.

Trading Methods for Listed and Over-the-Counter Stocks

listed stock

• Taiwan Stock Market: Open an account for trading with a Taiwanese securities firm.
• US Stocks: Open an overseas brokerage account or re-delegate
• Web3 Analogy: Opening an account on mainstream CEX for trading

OTC stocks

• Taiwan Stock Market: Place orders through a securities broker
• US stocks: Most overseas brokers support trading
• Web3 analogy: Using a decentralized wallet to trade on a DEX

Characteristics of Investing in Listed and OTC Stocks

listed stocks

Advantages:

• High potential for return
• Passive Income (Dividends)
• Against inflation
• High liquidity, similar to mainstream tokens

Risk:

• Market Volatility
• Need to conduct in-depth research

OTC stocks

Advantages:

• Wide range of investment
• The price is relatively low
• Potential high growth, similar to emerging tokens

Risk:

• Weaker regulation
• Poor liquidity
• High volatility

Stock Market Introduction Tips for Web3 Investors

1. Assess personal financial situation and risk tolerance.
2. Conduct in-depth fundamental and technical analysis
3. Clearly set investment goals and strategies
4. Understanding the Similarities and Differences Between Stocks and Crypto Assets
5. Consider a diversified portfolio, balancing traditional finance and Web3 assets.

Analysis of the Emerging Market

What is an emerging stock market?

• Trading platform for companies not yet officially listed
• More lenient conditions but higher risks
• Similar to early-stage blockchain projects or Initial Exchange Offerings (IEO/IDO)

Differences in the listing and over-the-counter processes between Taiwan and the United States

• Taiwanese companies usually need to be listed on the Emerging Stock Market first.
• US companies can directly apply for listing or OTC.
• Web3 Perspective: Analogous to the process of token projects from private placement, public offering to listing on mainstream exchanges.

Investors entering the stock market can draw on Web3 investment experiences, but they also need to pay attention to the differences in regulation, liquidity, and market mechanisms between the two. Whether traditional stocks or digital assets, in-depth research and risk management are key to successful investing.