Just as Amazon radically altered the retail landscape with Jeff Bezos’ mantra, “Your margin is my opportunity”, now it appears Robinhood is throwing hard punches at the retail financial investment market.

Recently, Charles Schwab slashed its stock commissions to zero and forced TD America, E-trade, Interactive Brokers, Ally Invest, and Fidelity to follow suit within a few days afterwards.

Schwab called this the zero commission brokerage war, on CNN.

This war is just the beginning of a broader trend that will be the demise of any product-driven business in financial markets.

If we have to deal with tough market conditions soon, I believe several brokerage businesses will go bankrupt or will be sold at a huge discount to current valuations, while they are trying to figure out how to reinvent their value propositions.

Compliance Remains a Fixed (and increasing) Overhead Cost

This downward pressure on price has no effect on the continuing increase in costs for compliance though. The only solution there is once again… cost efficiency through automation!

I love the sound of that so much I am going to say it again…


That’s where we really have an opportunity across the entire industry with XDEX. Compliance-as-a-Service is just one of the use cases for the platform.

According to the Financial Times, differences in financial regulations across the world are costing businesses an eye-popping $780bn a year.

That’s the cost of simply reconciling the differences in jurisdictions.

So the quick take on this is, we intend for XDEX to trigger its own “Robinhood Effect” on compliance costs.