According to techcrunch, cryptocurrency exchange FTX is launching stock trading function for its customers through its U.S. branch** The company, led by co-founder and billionaire Sam bankman fried, said in an announcement that before its full launch by the end of 2022, its launch will begin in a private test mode for a group of customers selected from the waiting list.
FTX, the world's second-largest cryptocurrency exchange, said it would offer "hundreds of securities listed on U.S. exchanges, including common shares and ETFs", including fractional shares in some securities.
It is worth noting that FTX plans to process all orders through NASDAQ rather than third-party market makers. The exchange said it would not receive order flow payment (pfof), which is a method of order execution, and Robin Hood is notorious. It involves the exchange receiving payment from market makers to guide orders. This is a controversial trade settlement method, because it often means that investors can't get their shares at the best price, because market makers profit from the price difference.
Robin Hood continues to use pfof because it can generate a lot of revenue from third-party market makers. In contrast, FTX will give up the profits of its stock trading services because it does not charge any fees or commissions in exchange for the services it provides to users.
FTX also said that it would allow users to fund their brokerage accounts with stable currencies supported by legal currencies such as usdc on the platform (these stable currencies are different from algorithmic stable currencies such as Terra, which are supported by other cryptocurrencies and do not hold reserves in the traditional sense). The exchange said it would be the first to offer this function, although users can also fund their accounts through standard methods such as wire transfer, ACh transfer and credit card deposit.
FTX will also not require customers to hold any minimum balance to qualify for a fee free account.
The announcement marks a critical moment in bankman Friede's vision of expanding FTX from an institution focused platform with a deep trading foundation to an exchange serving the broad needs of retail investors. Bankman fried revealed in a document last week that he had bought a 7.6% stake in Robin Hood, which may mark another step towards this goal.
FTX. Brett Harrison, President of us, said in an interview with the Wall Street Journal: "what we ultimately want to provide is all applications of financial services."