Binance (BNB-USD) is the world’s largest crypto exchange. Coinbase (NASDAQ:COIN) is the only publicly-traded exchange. Crypto.com (CRO-USD) is the most secure exchange. While all of these exchanges have their strengths, FTX has been quietly building itself up as an industry juggernaut set to overtake all of them. And this week, it takes a major step forward in that effort. After a busy summer of bailouts and acquisitions, FTX stock trading is the new business move that has people talking about the exchange.
FTX founder and CEO Sam Bankman-Fried has become a household name even outside of the crypto circle. He’s known as one of the most forward-thinking crypto entrepreneurs. He and his company are apt at advertising the trading platform. Not only this, but they are also consistently pushing into new frontiers with aggressive acquisitions.
The company is infiltrating the mainstream through a savvy marketing campaign. Atop landing its logo on MLB umpires’ uniforms and securing the naming rights to an NBA stadium, it also aired a commercial campaign featuring comedian Larry David that has massively succeeded in getting people talking about FTX.
Recent market tumult has allowed FTX to pursue its greater business motives as well. One of the most notable acquisitions across the entire financial landscape this year is of the company’s BlockFi deal. The latter fell into deep trouble with lenders after the crypto crash in May. After bailing out BlockFi with $400 million, the companies struck a deal that will allow FTX to buy BlockFi for just $240 million.
FTX Stock Trading Launches to Give Robinhood a Run for Its Money
While the BlockFi deal is the blockbuster bailout of the summer, it’s not the only purchase FTX has made. The company’s acquisition of Embed Financial flew under the radar in the midst of the market turmoil. This week, the purchase is paying off massively as FTX stock trading launches.
Bankman-Fried has showed interest in bringing stock trading to his platform for a while now. Last year, the company launched its tokenized stock trading platform. This tool allows users to buy tokens that represent shares of stocks held in reserve by FTX. However, the company remained resolute in bringing the real deal to its customers.
The Embed Financial deal was a huge step in this process, as it brought the company all of the tools and technology it would need to launch stock trading. The deal even came with Embed’s clearing house subsidiary. This week, FTX is showing the benefits of the purchase. The company says stock trading is now fully available for customers on its FTX.US platform. Using the platform, users can trade both stocks and exchange-traded funds (ETFs).
An especially noteworthy aspect of the FTX stock-trading platform is that it is free and it abstains from utilizing a Payment for Order Flow (PFOF) model. PFOF is a model largely popularized by Robinhood (NASDAQ:HOOD). While it enables platforms to make trades fee-free for end users, it has been highly scrutinized by the U.S. Securities and Exchange Commission (SEC) and investors alike.
Nowadays, most fee-free brokerages use PFOF, so the fact that FTX is not using the model is very appealing. And now, the company is just the second platform in the country to offer both stock and crypto trades on one platform, next to Robinhood. It will be very interesting to see whether FTX can successfully steal users from Robinhood over the coming months.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.