Robinhood raises another $2.4B from shareholders

Is it really? I absolutely appreciate that feature. Do we still want to be stuck in old financial system where it takes days for money transfer? It should all be instantaneous. That said, their risk/compliance team failed big time.

But I thought they had to put up collateral even someone was buying with USD that had been in their account for a while? Remember, they didn't just turn off insta-buy or whatever they call it.

I think RH would have had a much easier time in the court of public opinion if they had simply blocked their "instant deposit" feature to new users flooding into the network last week, and forced them to wait 3 days for ACH. People would have been super annoyed but it would have been pretty understandable in a world where the situation actually matched your description ("sudden influx of new customers buying risky stocks before their deposits cleared.")

What actually happened was that users with perfectly well-funded accounts also couldn't buy the stock, and nobody would explain why. (The actual explanation appears to be related to complicated rules around T+2 settlement and collateral, but that's a whole different thing than "people buying risky stocks on credit" which implies that the users were taking risks rather than the system is broken in complicated ways.)