- Wall Street’s main regulator released its highly anticipated report on the GameStop mania on Monday.
- The SEC said online brokerages, enticed to increase revenue through payment for order flow, are turning stock-trading into a game in order to encourage activity from retail investors.
- “Payment for order flow and the incentives it creates may cause broker-dealers to find novel ways to increase customer trading, including through the use of digital engagement practices,” the agency said.
The Securities and Exchange Commission said online brokerages, enticed to increase revenue through the controversial industry practice of payment for order flow, are turning stock-trading into a game in order to encourage activity from retail investors.
Wall Street’s main regulator on Monday released its highly anticipated report on the GameStop mania earlier this year. The 44-page report detailed how the trading frenzy went down and raised red flags on a number of issues, including the back-end payments that brokerages receive, gamification of trading, as well as disclosures on short sales. But it stopped short of laying blame on a single cause or entity.
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