Robinhood and GameStop proved we need a new financial system

We probably remember King Midas from the fable we tell our children, that the king can turn anything he touches into gold. At first it was a great idea, his greed even turned the food into gold, making him rich but unable to live.

Robinhood’s CEO and board of directors faced a stubborn dilemma this week: They had to decide whether to side with their customers and allow them to make over $15 billion in profits, or to stop trading and only allow sales from GameStop (GME) to allow loss-making short sellers to cover their positions at lower prices and avoid huge losses. Robinhood has shown everyone that his favorite color is money and that his friends are the same people who make sure you almost never win trading on Wall Street.

Looks like it: The GameStop saga shows that funding is hereditary, and DeFi is the answer.

Greed will always win

As usual on Wall Street, greed won. It wasn’t just Robinhood, Interactive Brokers, Ameritrade, Charles Schwab, Citadel and Point 72, but the entire centralized financial world sided with short brokers.

Robinhood has launched a platform and app that represents people and will always act in the best interest of its users. Still, the golden rule of startups applies: If you don’t pay for the product, you are the product. The company’s real plan was to raise enough money and assets to charge large market makers hundreds of millions of dollars for securities lending and order flow fees. Professionals on Wall Street call retail investors plankton, because that’s what hedge funds and corporations feed on to offer obscene profits and bonuses to their employees and shareholders.

How is it possible that 136% of the stock will be sold in 2021 without coverage? Who let this happen and why is no one held accountable? While everyone is trying to convince the Reddit crowd to buy GME, no one is addressing the root cause of GME’s problem: Collusion between brokers and hedge funds who use naked short selling to destroy companies for profit.

When there was a shortage at GameStop, we found out who the biggest Robin Hood customer really is: Citadel and Point72 (two of Wall Street’s largest hedge fund managers), who pay Robinhood more than $300 million a year in commissions for order flow and securities lending. It’s hard to believe Robinho is back when he’s always looking over his shoulder.

Related: R/Wall Streetbets vs : Prediction for DeFi’s explosion on stage?

Krypto is a shining city above thehedge.

Creating seamless access to basic financial services can unlock the latent genius and talent of our society. IQ is evenly distributed around the world, but access and opportunity are not. Access is often dependent on status and wealth, which means it is impossible to beat the system. What is possible? We need to seize this moment when traditional financial institutions are ushering in the innovation waves of blockchain technology.

Whether it’s short positions or lies about how much annual interest you should really earn by holding your assets in these institutions, it’s time to introduce real and achievable financial freedom through financial tools and methods that serve the interests of users and not the abusers at the top.

There’s a reason why some of the smartest, most innovative and community-minded leaders are now adding bitcoins (BTC) and ethers (ETH) to their portfolios and Twitter profiles. In protest of what we’ve seen this week – because no matter how hard they try – the hedge funds, bigwigs and tech bros can’t convert bitcoins into dollars that are only for their own pockets, because the decentralized community is bigger than them.

This article does not contain investment advice. There are risks associated with all investments and business transactions, and readers should do their own research before making a decision.

The views, thoughts and opinions expressed herein are those of the author and do not necessarily reflect or represent those of Cointelegraph.

Alexey Mashinsky is one of the inventors of the Voice Over Internet Protocol technology, whose first patent dates back to 1994. He is currently working on Money Over Internet Protocol technology. Alex holds over 35 patents in the areas of switches, VOIP, messaging and communication protocols. Alex is a serial entrepreneur and founder of seven startups in New York. He has raised over $1 billion and released over $3 billion. Alex is the CEO and founder of The Celsius Network, a cryptocurrency platform founded in 2017 that offers its members curated services not available from traditional institutions.

You May Also Like

Hedge Fund Manager Says Sell-off in US Treasury Bonds a Threat to ‘High-Flying Assets’ Like BTC

Hedge fund manager Bob Prince warned that the recent selloff in the…

Bitcoin exchanges just saw massive Tether stablecoin deposits

Nearly half a billion tether entries were reported on the 8th. April…

Blockchain.com raises $300M in crypto industry’s third-largest capital raise

London-based cryptocurrency provider Blockchain.com has raised $300 million in a new funding…

6 Questions for Sanja Kon of Utrust – Cointelegraph Magazine

We ask blockchain and crypto-currency builders what they think about the industry….…