PayPal could soon compete with Robinhood, the free stock trading app that increased popularity during the pandemic.
The online payments firm, like Robinhood, has lately begun allowing users to buy and trade cryptocurrencies, and it also intends to compete with Affirm by enabling clients to purchase products online using installment financing.
CNBC[1] was the first to report on PayPal's interest in stock trading, and it recently acknowledged that it hired the founder of an earlier investment platform to lead a new section named Invest at PayPal. PayPal, on the other hand, doesn't confirm whether that division is looking into stock trading.
Robinhood was launched to the public in July and is now worth roughly $40 billion. In its first earnings report, the corporation stated that revenue for the second quarter of 2021 was $565 million, up 131 percent from the previous year.
The company has been criticized for its casino-like app interface and for allowing untrained consumers to perform sophisticated deals they may not fully grasp. It has also been criticized for providing free trading – effectively, a third-party firm executes trades on behalf of Robinhood users. That firm can match buyers and sellers in such a way that it profits from the difference. The Securities and Exchange Commission is investigating this as a potential conflict of interest because Robinhood may not provide users with the best pricing.
Despite these concerns, fans of Robinhood claim that the company's simple-to-use app has encouraged more Americans to participate in the stock market, which has traditionally seen the lion's share of profits go to rich, "sophisticated" investors. The surprise increase of stocks such as GameStop and AMC has been viewed as regular people collectively saying they will no longer tolerate the status quo.
Paypal used to be the most popular online payment provider, mainly to its connection with eBay, another early internet powerhouse. However, competitors like Robinhood and Square's Cash App, which acts similarly to PayPal as a person-to-person payment service, began enabling cryptocurrency trading earlier.
The online payments firm, like Robinhood, has lately begun allowing users to buy and trade cryptocurrencies, and it also intends to compete with Affirm by enabling clients to purchase products online using installment financing.
CNBC[1] was the first to report on PayPal's interest in stock trading, and it recently acknowledged that it hired the founder of an earlier investment platform to lead a new section named Invest at PayPal. PayPal, on the other hand, doesn't confirm whether that division is looking into stock trading.
Robinhood was launched to the public in July and is now worth roughly $40 billion. In its first earnings report, the corporation stated that revenue for the second quarter of 2021 was $565 million, up 131 percent from the previous year.
The company has been criticized for its casino-like app interface and for allowing untrained consumers to perform sophisticated deals they may not fully grasp. It has also been criticized for providing free trading – effectively, a third-party firm executes trades on behalf of Robinhood users. That firm can match buyers and sellers in such a way that it profits from the difference. The Securities and Exchange Commission is investigating this as a potential conflict of interest because Robinhood may not provide users with the best pricing.
Despite these concerns, fans of Robinhood claim that the company's simple-to-use app has encouraged more Americans to participate in the stock market, which has traditionally seen the lion's share of profits go to rich, "sophisticated" investors. The surprise increase of stocks such as GameStop and AMC has been viewed as regular people collectively saying they will no longer tolerate the status quo.
Paypal used to be the most popular online payment provider, mainly to its connection with eBay, another early internet powerhouse. However, competitors like Robinhood and Square's Cash App, which acts similarly to PayPal as a person-to-person payment service, began enabling cryptocurrency trading earlier.
PayPal hopes to reclaim the crown by catching up with the hip upstarts and become a one-stop-shop for all forms of digital transactions.
[1] https://www.cnbc.com/2021/08/22/paypal-crypto-service-launches-in-the-uk.html
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