Robinhood decided to start training traders
Fintech startup Robinhood is the developer of one of the most popular mobile app for trading without commissions. After the recent suicide of a twenty-year-old user, the developers of the application promised to introduce educational courses for users, tighten requirements for customers, and change the interface.
Alex Kearns, a 20-year-old student at the University of Nebraska, committed suicide on June 12 after finding out that he had almost $1 million in debt. Vlad Tenev and Baiju Bhatt, founders of the startup, noted in their blog that they decided to improve the quality of the service after the incident.
The application will introduce additional criteria for user access to binary options trading. Among other things, the list of available educational materials will be expanded for users. To do this, Robinhood will hire a dedicated person to train traders. The interface of the app will also be changed to clearly show the user’s balance. In addition, the owners of the startup decided to donate $250,000 to the American Suicide Foundation.
Trader Alexander Kearns committed suicide in mid-June. In his note, he admitted that he was not aware of his actions. Before his death, he logged into the application and found an account debt of $730,165. He also noted that he didn’t allow the service to trade with leverage, and therefore was very surprised to find such a debt on a modest account.
Judging by the screenshot from his phone, the guy’s account really had a negative balance. However, it is possible that these numbers were indicative of the temporary state of the account until the time when the stock in the options basis was credited to the account.
Most of the startup works with millennials. It offers them commission-free trading services using a convenient mobile app, and also gives them a starter share package. Due to the crisis, the service increased by 3 million customers in the first quarter of this year.