Cryptocurrency Exchange FTX To Offer Zero-Fee Stock Trading
It will also allow stablecoins to be used for the purchasing of stock.
FTX will begin offering zero-fee stock trading of US equities to its users according to a tweet from the CEO and Founder Sam Bankman-Fried, Thursday, May 19. As of now, the feature is available for testing for a select group of waitlisted users, with plans to expand the offering to all users over the next month.
3) We’re opening stock trading with no Payment for Orderflow and no fees.
So what do we make from it?
Nothing. And that’s ok. Our goal is just to give customers a great experience.
— SBF (@SBF_FTX) May 19, 2022
Just a week prior to this news, Bankman-Fried purchased a 7.6% stake in Robinhood, a position worth approximately $650 million USD.
The new offering from FTX will allow users to trade and invest in hundreds of US exchange-listed securities from common stocks to exchange-traded funds (ETFs), which simply defined act as a basket of stocks under one ticker. The company plans to integrate the offering into its existing cryptocurrency exchange application, making it possible for users to purchase stock using fiat-backed stablecoins like USDC — an industry-first integration.
“Our goal is to offer a holistic investing service for our customers across all asset classes. With the launch of FTX Stocks, we have created a single integrated platform for retail investors to easily trade crypto, NFTs, and traditional stock,” said FTX US President Brett Harrison, adding that, “there is clear market demand for a new retail investment experience that offers full order routing transparency to customers and does not rely on payment for order flow.”
Payment for order flow (PFOF) is the compensation and benefit that a brokerage firm receives for directing orders to different parties for trade execution, ultimately making money in the margins of quoted prices of equities to retail investors. Bankman-Fried said that FTX will not use PFOF or charge any trading fees and that the company will not profit off of orders in general, saying that, “our goal is just to give customers a great experience.”
Elsewhere on the Blockchain, the Ethereum Merge is set to take place in August.