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Netflix stock has delivered crypto-like returns as it has risen nearly ten-fold in just the past 5 years.

While some shares, like those of Netflix, are attractive due to the capital gains they can deliver, the vast portion of established companies’ shares are bought for the sake of receiving dividends. Anyone who owns a company’s shares has a stake in the company’s earning, which are distributed as dividends. Dividends give an intrinsic value to shares.

NFLX's meteoric gains show that cryptocurrencies are not the only means to earn massive earnings.

Future dividend potential is also the force behind sharp rises in certain company’s stock price. Netflix stock, for example, has risen so much because people expect one day Netflix will be able to pay out huge dividends due to a very high earning. Dividends payments are a major legal and financial undertaking by most companies. It’s their way of delivering on the returns they owe to their investors.

Despite the importance of dividends, limited efforts have been made to lower the cost of their distribution.

Another key purpose of shares is to grant voting rights to the holders. Of course, anyone who has a stake in the company deserves a proportional decision-making power. The execution of voting rights, too, is an expensive execution.

While the financial world has been an innovative power-house in terms of developing unique derivatives, the execution mechanisms of dividend payments and voting rights have not received much focus.

A Disruptive New Player

A team of bankers has recognized the potential benefits blockchain technology can offer to the securities markets. The founders of CDRX are providing the opportunity to trade financial securities like tokens, and this brings many benefits.

A crypto depository receipt (CDR) is created when a stock or dividend is deposited at a trusted fund or depository bank. CDRs, which are backed by the deposited stock/bonds, are then given to the depositor.

CDRX provides the innovative solutions blockchain technology has unlocked with respect to dealing with dividend payments and voting rights.

Projects that have issued security tokens have come up with innovative solutions to execute tasks like dividend payments and collection of token holder votes. By integrating smart contracts, dividend payments and voting rights have become an extremely efficient, low-cost, and automated task for security tokens.

CDRX, which will facilitate the creation and trade of CDRs, is going to provide the benefits of smart contracts to holders of traditional securities. Anyone who owns CDRs will have the right to claim the dividends and voting rights attached to the underlying bonds and stock. Corporations that have to exercise these tasks will be able to do so easily and affordably.

By utilizing smart contracts, the collection of votes will be made extremely efficient.
Rather than having to pay dividends to one shareholder at a time, a corporation could send just 1 payment to CDRX, which could then distribute the dividends to internal wallets via smart contracts or an internal engine.

Additionally, CDRX will enable swift fulfillment times; so, shareholders will be able to claim their dividends in record time.

These swift fulfillment timelines are also applicable to the trade of CDRs; CDRX will not only make it possible to swiftly change ownership of securities-backed receipts, but will also provide disruptively low trading charges.

Wrap-Up: CDRX is bringing an innovative and much-needed efficiency solution to fulfilling the primary purpose of shares: giving their owners the right to receive their portion of the company’s earnings and voting on important decisions.