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Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

crypto.robinhood.com

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Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#161

Post by willart4food »

dawhizkid wrote: post #123

Something about Robinhood just makes me uneasy - clearly their main target market is the small retail investor who is sensitive to a $7/trade fee, but the low friction, mobile-first no fee stock trading experience they've created mostly serves to encourage bad investor behavior i.e. emotional, irrational day trading among people who can least afford it. Now they are "democratizing" margin trading (Robinhood Gold), op…

Bad behavior? RH's market is the Millennials who see it as a fancy gambling, check out Reddit's r/RobinHood or - even better - r/wallstreetbets.

I can see RH becoming a dominant player in the Tech Fin Millennials space.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#162

Post by buttcoinslol »

darawk wrote: post #148
Retric wrote: post #97

Earlier quoted context omitted.

What separates investing from gambling is the expected return for everyone is greater than zero. AKA buy stock at 100$ and sell it at 100$ does not mean you broke even. You could have gotten 10$ in dividends. Now that positive may be small and some people may lose money, but that's allowed as long as the expected returns end up positive. Bitcoin's can't have a net positive return because they only way to add money in…

Bitcoin can absolutely have a net positive return. People can simply keep buying it and holding it. Do you think gold cannot be an investment?

Gold is speculative, stocks are investments. Bitcoin is speculative.

https://i.imgur.com/AltAcnB.jpg

Keep in mind this graph is logarithmic in scale.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#163

Post by [deleted] »

ckinnan wrote: post #118
AznHisoka wrote: post #104

Earlier quoted context omitted.

What about stocks with no dividends (which constitutes the vast majority)? By your definition, only dividend investing and rental property investing is true investing. I'm not disagreeing with you. In fact I almost agree with you, but your argument fails for most stocks.

The vast majority of mainstream stocks PAY dividends-- in fact about 420 of the S&P 500.

[deleted]

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#164

Post by dawhizkid »

foobaw wrote: post #145
dawhizkid wrote: post #123

Something about Robinhood just makes me uneasy - clearly their main target market is the small retail investor who is sensitive to a $7/trade fee, but the low friction, mobile-first no fee stock trading experience they've created mostly serves to encourage bad investor behavior i.e. emotional, irrational day trading among people who can least afford it. Now they are "democratizing" margin trading (Robinhood Gold), op…

I think Robinhood's purpose is exactly to promote "emotional, irrational day trading." Isn't that part of what impacts the market anyway? There are tons of bad traders in any given platform, and you're right that Robinhood increases that likelihood but you can't exactly blame an app for poor trading motivations. That's a due diligence.

Everything from the marketing to branding/design to distribution channel is designed to encourage higher frequency active trading among retail investors. When you're using Facebook-like product design tactics to encourage "engagement" (in this case, more trades), then you're not a neutral fee-free brokerage but an active contributor to irrational behavior.

I would be less critical if they had a library of investor education materials, or required investors to go through a training course to understand the risks of riskier trades (i.e. margin or options trading), but as far as I know they don't have anything like that.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#165

Post by bertjk »

AznHisoka wrote: post #104
Retric wrote: post #97

Earlier quoted context omitted.

What separates investing from gambling is the expected return for everyone is greater than zero. AKA buy stock at 100$ and sell it at 100$ does not mean you broke even. You could have gotten 10$ in dividends. Now that positive may be small and some people may lose money, but that's allowed as long as the expected returns end up positive. Bitcoin's can't have a net positive return because they only way to add money in…

What about stocks with no dividends (which constitutes the vast majority)? By your definition, only dividend investing and rental property investing is true investing. I'm not disagreeing with you. In fact I almost agree with you, but your argument fails for most stocks.

If the dividend-less companies are profitable, then you can still expect the increased value to get returned to you through stock buybacks, or an eventual dividend or acquisition of the company in the future.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#166

Post by rocketpastsix »

buttcoinslol wrote: post #154
foobaw wrote: post #145

Earlier quoted context omitted.

I think Robinhood's purpose is exactly to promote "emotional, irrational day trading." Isn't that part of what impacts the market anyway? There are tons of bad traders in any given platform, and you're right that Robinhood increases that likelihood but you can't exactly blame an app for poor trading motivations. That's a due diligence.

It's a very good app for buying up small (50-500 dollar) blocks of ETFs to hold, which is what I do. Thanks for the free trades, VC guys.

Thats pretty smart.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#167

Post by Retric »

darawk wrote: post #148
Retric wrote: post #97

Earlier quoted context omitted.

What separates investing from gambling is the expected return for everyone is greater than zero. AKA buy stock at 100$ and sell it at 100$ does not mean you broke even. You could have gotten 10$ in dividends. Now that positive may be small and some people may lose money, but that's allowed as long as the expected returns end up positive. Bitcoin's can't have a net positive return because they only way to add money in…

Bitcoin can absolutely have a net positive return. People can simply keep buying it and holding it. Do you think gold cannot be an investment?

Gold is a store of value. Buy 1 lb of gold and in 100 years you have 1 lb of gold minus storage fees.

However, over a long enough timeframe storage fees eat up the entire value of gold stored thus it's not a long term investment.

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#168

Post by parasj »

buttcoinslol wrote: post #154
foobaw wrote: post #145

Earlier quoted context omitted.

I think Robinhood's purpose is exactly to promote "emotional, irrational day trading." Isn't that part of what impacts the market anyway? There are tons of bad traders in any given platform, and you're right that Robinhood increases that likelihood but you can't exactly blame an app for poor trading motivations. That's a due diligence.

It's a very good app for buying up small (50-500 dollar) blocks of ETFs to hold, which is what I do. Thanks for the free trades, VC guys.

Robinhood makes money on execution (through exchange maker-taker fees [1] and reselling order flow to hedge funds or market makers).

It's in their best interest to promote more volume to increase revenue. They're making money of each and every trade.

[1] for example https://www.nasdaqtrader.com/Trader.aspx?id=bx_pricing

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#169

Post by asciimo »

tptacek wrote: post #30
DerfNet wrote: post #27

Earlier quoted context omitted.

I buy bitcoin, it changes in value, I cash out, I now have a different amount of money than I put in. How is that not an investment?

I put money down on a blackjack table, play a hand, win, and cash out with more money than I put in. How is that not an investment?

Is that an analogy for stock trading or cryptocurrency trading?

Re: Robinhood Crypto – Invest in Bitcoin and other cryptocurrencies

#170

Post by [deleted] »

parasj wrote: post #168
buttcoinslol wrote: post #154

Earlier quoted context omitted.

It's a very good app for buying up small (50-500 dollar) blocks of ETFs to hold, which is what I do. Thanks for the free trades, VC guys.

Robinhood makes money on execution (through exchange maker-taker fees [1] and reselling order flow to hedge funds or market makers). It's in their best interest to promote more volume to increase revenue. They're making money of each and every trade. [1] for example https://www.nasdaqtrader.com/Trader.aspx?id=bx_pricing

[deleted]
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