Thursday, September 18, 2025

Latest

Robinhood Sent Plummeting as SEC’s Gensler Hints at Potential Payment-For-Order Flow Ban

Monday was a strenuous day for Robinhood (NASDAQ: HOOD). Not only did reports surface that payments giant PayPal is looking to get into the stock trading business, but it also appears that SEC Chair Gary Gensler is mulling a potential ban of payment for order flow — one of Robinhood’s main sources of revenue.

Shares of Robinhood were sent plummeting before session close on Monday, after Barron’s published an interview with Gary Gensler, where the SEC Chair revealed that banning payment for order flow is back “on the table.” According to Gensler, PFOF— which allows discount brokerages such as Robinhood to charge zero commission for its services by sending trade orders to market makers such as Citadel in exchange for a portion of the profits— poses “an inherent conflict of interest.”

PFOF is one of Robinhood’s main sources of revenue, and allows the trading app to bypass commission fees from its users. However, the practice has been on the receiving end of significant criticism, particularly because it hinders markets from reaching full transparency. Market makers “get the data, they get the first look, they get to match off buyers and sellers out of that order flow,” explained Gensler. “That may not be the most efficient markets for the 2020s.”

Although Gensler stopped short of providing specific examples of where such conflict of interest has resulted in harm to investors, he said that SEC staff are currently in the midst of assessing the practice, and will likely come up with new proposals in the coming months.


Information for this briefing was found via Barron’s. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Why $10K Gold No Longer Sounds Crazy | Dan Wilton – First Mining Gold

The Pure Silver Set Up! | Joaquin Marias – Argenta Silver Corp

Why $30,000 Gold Isn’t Crazy! | Simon Marcotte – Northern Superior

Recommended

Canadian Copper Secures $8 Million Lead Order From Ocean Partners As Part Of Larger Funding Round

Northern Superior Expands Philibert With 350 Metre Step Out Testing 1.10 g/t Gold Over 25.5 Metres

Related News

Simply Obscene: Excessive Stock Based Compensation Largely Ignored By Investors

As investors have decided to place an enormous premium on growth stocks over the last...

Sunday, August 28, 2022, 09:00:00 AM

SEC Has Crypto Community on Edge Over Potential Wells Notices

The SEC is sending out Wells Notices to a number of US-based stablecoin firms, ordering...

Wednesday, February 15, 2023, 06:08:00 AM

Robinhood Revenues Likely To Decline Markedly on Sequential Basis

Robinhood Markets Inc. (NASDAQ: HOOD) plans to release 3Q 2021 earnings on October 26, and...

Saturday, October 16, 2021, 09:00:00 AM

SEC Wants To Freeze Binance US Assets; Binance Says “User Assets Remain Safe And Secure”

The U.S. Securities and Exchange Commission (SEC) has launched an all-out assault on cryptocurrency exchange...

Wednesday, June 7, 2023, 02:22:00 PM

SEC Slaps DWAC with Fraud Charge Over Undisclosed Trump Media Acquisition Plans

The SEC has charged SPAC Digital World Acquisition Corporation (NASDAQ: DWAC) with fraud over its...

Sunday, July 23, 2023, 07:07:00 AM