Robinhood launches crypto trading in the European Union | Hacker News Reader

Robinhood launches crypto trading in the European Union

newsroom.aboutrobinhood.com

29 pointsmfiguiere49 comments

I'm trying to understand the voodoo trickery that squares these two statements:

"Customers will earn a reward of up to 1 BTC when they first sign up and can receive up to 1 BTC for each successful referral"

and

"98% of rewards are worth €10–€20 in BTC."

Up to 1 BTC also includes 0.0002 BTC. It's pretty scammy, but then Robinhood is kind of notorious.

Seems like their target market is sensitive to betting/gambling prompts.

Presumably the reward amount is random with a few people getting dramatically more than everyone else. As if you got an entry into a lottery as a reward.

And they select the winner of the 1BTC reward as an influencer with a lot of followers for a great get rich quick scheme advertising...

They did this strategy with stock, maybe they still do. You got a random share that could potentially be Microsoft or Apple or what not and you could earn more via successful referrals. I ended up getting some random pharmaceutical company whose name eludes me but it hovered around $5 the entire time I had it. I think it peaked at 8-9 once even, it was quite exciting for a neophyte like I was then.

Key words: “up to”

You can sell one egg with up to a million dollars.

    Robinhood Crypto is a trading platform where
    users own their own crypto and we hold it
    securely on their behalf.

Is this regulated somehow? Are there any governmental auditors coming in from time to time and check whether that crypto really exists? Or is it possible that they sell unbacked IOUs?

In crypto, the answer to "is this regulated" and "are there government auditors" is always "haha absolutely not".

And they really like it that way. Sure, Sam Bankman-Fried is in jail because he took $8 billion of funds that his company was supposed to be holding on customers' behalf. But see, that's actually positive for crypto, as it somehow in crypto-bro logic proves that everybody else is clean as a whistle. (Never mind that SBF was the #1 credible face of this industry only 14 months ago.)

There is no crypto trading platform or organization which had even a single independent audit, in any country. That's more than enough information I think :)

This is not true

Like what? Audit is not equal to attestation. Some platform did attestations, but those are meaningless.

I was indeed thinking of the proof of reserves audits (attestations).

I'm surprised people still trust Robinhood after the GameStop debacle.

https://en.m.wikipedia.org/wiki/Robinhood_Markets

Why wouldn't they?

Gamestop meme traders deliberately set out to smash the system and they succeeded to a small extent. Robin Hood, in the face of the partners they rely on refusing to allow further acquisitions, did the best they could by still allowing selling.

For any normal trader what happened on one specific day to one specific stock which was deliberately manipulated on a massive scale to try and cause a trading halt is utterly irrelevant.

> Why wouldn't they?

Because there are better brokerages out there.

> in the face of the partners they rely

You mean their actual customers. There are brokerages where the incentives are not perversed like this.

> did the best they could by still allowing selling

Assuming they acted in good faith to do their "best", their CEO was still incompetent failing to anticipate to liquidity issues

> what happened on one specific day to one specific stock

They halted buying on more than GME.

You do know that besides Robinhood many of the other brokers also halted trading the same tickers? Robinhood was the face of the issue for sure, but a lot of others did the exact same thing.

Yes, I do.

I said there are better brokerages, and that point still stands. Vanguard, for example, didn't.

I never said that all other brokerages are better than Robinhood. In fact, there are worst.

Just because other brokerages did the "exact same thing" doesn't excuse them or Robinhood.

I know its hard to believe, but the entire customer base (23.3M) of Robinhood is a testament to how good their product is in spite of the misgivings of the brokerage during the "GME". If it makes it feel better, their MAU is down 16% year-over-year to 10.3 million.

I am also a user and I love it - and while I don't trade crypto, but they offer the lowest commission in crypto. And my uninvested cash gets a decent interest (5%), and my trades execute reasonably well. It maybe not for a professional trader, but my own experience has been fantastic for what it offers.

Also incredibly thankful that there is no trading fees across many of the brokers now, which I believe was forced by Robinhood. I know of the PFOF controversy, and regardless I hold this view.

I also know I can't change your view, but hope you have a great weekend ahead!

And a lot of others didn't do the same thing. Whats your point?

Most of those 'other brokers' that halted trading, were similar to Robinhood, as in not really a proper brokerage. No serious bank ever halted trading, why would they?

Because the Wallstreet bet types don’t really use them?

Etrade also did and it’s the retail trading arm of Morgan Stanley which is the sixth biggest bank in the country…

I don’t know what your qualifications for a proper brokerage could be.

Fidelity has been down at least a dozen times this year, for hours at a time during trading hours. It's not exactly a halt, but effectively same boat.

>Robin Hood, in the face of the partners they rely on refusing to allow further acquisitions, did the best they could by still allowing selling.

You mean Robin Hood manipulated the markets? By only allowing sell orders you manipulated the price and market. In some cases they even automatically sold positions without knowledge of the retail traders.

They should have gone bankrupt, instead they robbed many retail traders.

That’s the wallstreetbets angry meme explanation but not what happened.

What actually happened is brokerages are required to hold capital reserves to cover options held by customers. You can spend a few dollars and your brokerage is required to have sometimes tens or hundreds of thousands in the bank to cover your option.

During peak memestock options activity went to a crazy unprecedented level, Robinhood had to raise billions of dollars in a day or two, like nearly four billion in a few days. And it wasn’t enough so they had to stop trading or put limits on buying options for GameStop and a few others. Etrade and interactive brokers at least also did.

They didn’t go bankrupt or get stomped by regulators or congress because they were behaving within the law and reasonably in an unprecedented situation.

My understanding comes from articles like this one https://www.cnbc.com/amp/2021/02/03/why-investors-were-willi...

Weren't they also in direct communication with the (I think non-existing) hedge fund that would benefit from them allowing only to sell?

Really hard to comment on such a vague insinuation.

I saw gamestop the movie recently and it was stated as fact towards the end, IIRC. I was just vaguely remembering it, but I believe it is proved.

Did they sell positions where they had no right to sell?

If they, hypothetically, had gone bankrupt, how would that have helped retail traders in that moment?

>Gamestop meme traders deliberately set out to smash the system

That is a very strange and biased POV. They did the exact same thing as people have done for years and years, the only difference being this was joined by many people not in the industry.

My understanding was that the whole point of the Gamestop trading was to force financial companies into a position where they were facing insolvency.

I guess it was a hyperbolic to describe it as smashing the system, but the key thing is that the primary purpose was to cause disruption, rather than purely to make a profit. That they became angry when that disruption occurred is a bit baffling to me.

We like the stock

What do you think is wrong with the way they handled the GameStop debacle? They say they run out of cash to fund people buying GameStop on margin. They raised more from investors and opened up buying again. The facts stand up that the whole debacle was a result of their incredibly generous margin facilities. Other (better) trading platforms exist that didn't stop allowing purchases but also didn't give out $1K interest free margin.

> Robinhood restricted trading in these stocks in order to meet collateral requirements at their clearinghouse

> The [class action] case was dismissed by the Miami federal court that November, on the grounds that the plantiffs fell short of providing direct evidence of an antitrust conspiracy

related, they also launched stock trading in the UK:

https://robinhood.com/gb/en/

https://newsroom.aboutrobinhood.com/introducing-robinhood-in...

> Introducing Robinhood in the United Kingdom

> Starting today, we’re rolling out brokerage services in the United Kingdom. UK customers will have access to commission-free trading* of more than 6,000 US-listed stocks and ADRs including TSLA, AMZN, and AAPL. Our expansion to the UK marks an important milestone in our journey to democratise finance around the globe and increase access to the markets for all.

> At launch, we’ll offer trading without foreign exchange (FX) fees, trading outside of market hours with Robinhood 24 Hour Market*, and no account minimums. Customers can build a portfolio for as little as $1 and grow their uninvested cash as they work out their investment strategy, earning 5% AER.

Is this the same Robinhood partially owned by a private brokerage firm also running its core order clearance system services. Then turning around and hosing the users when the short squeeze is pinching said firm too hard.

How are these guys still in business? It is like seeing a Chihuahua eat a 40lb bag of dog treats,.. impressive for the wrong reasons. lol =)

Yep, the same scam Robinhood. I guess the have to pivot to crypto, because their other business is not running well?

Now? What's the point? Can you still find marks who didn't learn all crypto are scams?

Recently number go up, so there will be people tempted to "invest" in number going even upper.

Of course, number going up is purely due to consumer and institutional demand and has nothing to do with, say, Tether printing another 5 billion USDT recently.

https://davidgerard.co.uk/blockchain/2023/12/06/bitcoin-goes...

I have this fantasy that Tether is legit, and trying to look shady, so that they can buy dollars at a discount. Any time market confidence falters, they prop up this price by buying back tether (which is backed 1:1) at a price under 1. They purposefully don’t provide any evidence, because it leads to cheaper dollars for them to purchase.

Definitely not true, but what a beautiful “scam” that would be.

Lot of people where too young last time and are now new targets. I don’t think they will ever run out of people to scam.

I'm not here to judge crypto, but regardless : casual, loosely-regulated financial investment, in a famously volatile space, and controlled via smartphone app, is a scenario that warrants cautious decision-making.

It's a gambling app, plain and simple.

Their legal adress seems to be a postbox at a small law firm branch, shared with several other crypto businesses.

Learned my lesson. They will not see a cent of my money.

That makes me sad. Crypto is just other people’s money. Just more people in tears over lost money.

Wow just in time for the hype train.

some of their older ads say 'no fees'

is that still true? how do they make money then?

Reply on news.ycombinator.com