FTX's Silent Moves that Could Cause Tsunamis

By Cje95 | Chronic Illness and Crypto | 24 May 2022


Waves have already been made by FTX recently. Well not by the company but by its CEO who purchased 8.7% of compliment/rival Robinhood. It has been discussed that this could be a setup for FTX or Robinhood to buy out the other or even the two to merge and form a new company.

 

The easiest explanation for this is that Robinhood currently has a great foothold in the U.S. while FTX has a solid foothold internationally. They also offer different products currently with FTX being a crypto company first and Robinhood being a brokerage first. If we look at these two companies as puzzle pieces they would be ones that would fit together perfectly!

 

A variety of companies have talked about being the one app that has it all offering both stocks and crypto. The current market is extremely fragmented in the United States. Robinhood currently is easily in the lead when it comes to combining stocks and crypto as it is really the only one offering this kind of exposure. Coinbase has talked about it but with cryptos sharp downturn and the recent comment made during their earning report, it seems unlikely they would be able to catch up and offer even something as basic as index funds. 

 

Since FTX has established itself in so many markets and has certificates allowing it to operate as a crypto broker puts it in a very interesting position. Recently they have launched a stock brokerage service as well however it is not available in the US which traditionally has a high barrier of entry. News has since come out about FTX approaching startups in the US who offer brokerage services to get a sense of being able to acquire them and thus their license and ability to operate in the US. With FTX as an owner, they would be able to provide a lot more capital and the ability to spur growth in these startups. 

 

If FTX were to pull this off Robinhood and Coinbase would be crushed as they would just be pieces while FTX would have the whole thing. This also highlights the issue with FTX's CEO owning 8.7% of Robinhood now. He would not want his investment to turn crash and burn in value. It would make sense then that the CEO would do what he could to increase his value and that is where it becomes possible to see an attempt to buy out or take over Robinhood. If Robinhood's stock price continues to decline and FTX is able to offer a sizeable premium it could be that they buy out Robinhood. This would give them complete access to the US market saving them a ton of time and money. Following this investment and story will be a key insight into FTX's future moves and what Robinhood does in turn. 

 

FTX has a rare opportunity to rattle the markets in a way that Robinhood did years ago with feeless trading. How they approach and execute this ability is vital to see what the future holds and who ends up on top of this critical race that many companies are participating in. 

 

Please know I am not a financial advisor and make sure you do your own research! If you enjoyed this article and would like to further support me below are a few referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_

 

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Cje95
Cje95

Graduated from Texas A&M in May of 2020 had dabbled in crypto since 2017 but dove in at the end of 2019. December of 2020 packed up and moved to D.C.! Huge sports fan, space nerd, and international newsreader! Follow me on Twitter @Cje95_


Chronic Illness and Crypto
Chronic Illness and Crypto

Cryptocurrency and Blockchain are going to be a huge part of the future and no matter who tries it isn't going to be stopped! Here I try to give my best insight and thoughts into the latest crypto news, features, developments. Further, I look to discover any link to news from the United States ranging from social-political issues to stock market and economic data.

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