Since each person can verify the profits on-chain independently, it would raise raise flags if the amount if profits did not correspond to the expected amount of profits based on the assets which the business claims to have. All assets are disclosed publicly.
You can verify what you _think_ the profits are. What I’m saying is that you’re verifying something that isn’t relevant.
Do you think there aren’t sophisticated accounting systems, auditors, banking checks, etc to accomplish what you describe? And yet people will always find a way with enough incentive.
A director could potentially do something elaborate like buy a lot of tokens at a low price anonymously, then take a bank loan and use it to pump up the price through fake buybacks then dump for a higher price some years later hoping that they don't get caught by their bank in the meantime for misusing the credit... But then why would they use our blockchain and jeopardize the value of their own large director's stake (from their main wallet) with such scheme? Why not use a random token not affiliated with them and which has lower volume where this scheme would have more effect on price and where the attacker has nothing at stake?
No matter which way you look at it, this is a huge transparency improvement over shares.
Wonderful, so when the proprietor starts embezzling from the real-world operations, I’m sure you have that sorted out. Just sprinkle some blockchain on it.
Your comment seems well meaning, but you do not seem to understand the real issues with due diligence. Source: ran US equity book for large hedge fund