“I could hardly believe what I saw on Reddit today,” he sang. “I was hoping I could get it directly from you. They told me about the order flow, so I searched Google, now I know. I think I need to find someone new.”
Bolton continues, “So, tell me all about it. Tell me who you sell my transactions to.”
Pop culture criticism underscores the enormous attention being paid to the way Robinhood and other brokers have adopted commission-free business models. Critics say trading is not really free and that high-speed trading firms on Wall Street are getting the best of the deal.
During the introduction of his music, Bolton noted that Public.com says it does not sell transactions to third parties.
“I know a thing or two about separations. And I’m here to help,” said Bolton.
Robinhood has consistently advocated its use of payment for order flow, which represents more than half of the company’s revenue.
During the first half of 2020 alone, Robinhood estimated that its customers received more than $ 1 billion in price improvement – the price they received compared to the best price on a public exchange.
Citadel Securities, the high-speed trading firm to which Robinhood sends many of his orders, also defended the practice.
“It is one of the main reasons why retail investors can trade for free or with low commissions today,” said Citadel Securities founder Ken Griffin, during the hearing.