Robinhood and GameStop have proven that we need a new financial system

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King Midas is best remembered by the fable we tell our children that the king could turn anything he touched into gold. At first it was a great idea that his greed even turned food into gold and made him rich but unable to live.

Robinhood CEO and board of directors had King Midas’ impossible dilemma this week: They decided whether to side with their customers and make them over $ 15 billion in profit, or stop trading and just selling GameStop (GME) to allow the money-hungry shorts to cover their position at lower prices and avoid massive losses. Robinhood has shown everyone that his favorite color is money, and his friends are the same people who make sure you almost never win the Wall Street trade.

Connected: The GameStop saga shows legacy funding has been rigged, and DeFi is the answer

Greed will always win

As usual on Wall Street, greed triumphed. It wasn’t just Robinhood, Interactive Brokers, Ameritrade, Charles Schwab and Citadel and Point 72, but all centralized finance was on the shorts side.

Robinhood launched a platform and app that represented the people and always acted in the best interests of the users. However, the golden rule for startups applies: if you don’t pay for the product, you are the product. The company’s real plan was to amass enough order flow and assets to charge large market makers hundreds of millions of dollars in stock lending and order flow fees. Wall Street professionals call retail investors “plankton” because hedge funds and institutions rely on delivering obscene profits and bonuses to their employees and shareholders.

How is it possible that 136% of shares will be sold short in 2021? Who allows such things and why is no one held responsible for them? While everyone is focused on enabling the Reddit mob to buy GME, no one is investigating the root cause of the GME problem: the collusion between brokers and hedge funds to destroy naked short-selling companies for pure profit.

When the GameStop Short Squeeze took place, we found out who Robinhood’s biggest customer really was: Citadel & Point72 (two of Wall Street’s best-known hedge fund managers), which charges Robinhood over $ 300 million annually for Lending pays the order flow and the securities pays. It’s hard to believe that Robinhood has its community back when it is always looking over its shoulder.

Connected: r / Wallstreetbets vs. Wall Street: A Prelude to DeFi?

Krypto is the shining city above the hedge

Creating unhindered access to basic financial services has the potential to unleash genius and sleeping talent in our society. IQ is evenly distributed across the planet, but access and opportunity are not. Often times, access depends on status and wealth, which means that it is impossible to beat the system. What is possible? We need to seize this moment, when traditional financial institutions are exposed, to introduce the waves of innovation that have emerged in blockchain technologies.

From naked short positions to lying about how much annual percentage return you should really get by holding your assets with these institutions, it’s time to introduce real, impactful financial freedom through financial instruments and methodologies made in the best interests of the user and not act the culprit at the top.

There’s a reason some of the smartest, most innovative, and community-minded executives are adding Bitcoin (BTC) and Ether (ETH) to their wallets and adding them to their Twitter profiles today. In protest of what we saw this week – because no matter how hard they try – hedge funds, fat cats, and tech brothers can’t turn Bitcoin into dollars that are just for their own pockets because the decentralized community is bigger as they.

This article does not contain any investment recommendations or recommendations. Every step of investing and trading involves risk, and readers should conduct their own research in making their decision.

The views, thoughts, and opinions expressed here are the sole rights of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Alex Mashinsky is one of the inventors of the Voice Over Internet Protocol with a basic patent dating back to 1994 and is currently working on the Money Over Internet Protocol technology. Alex have been granted over 35 patents relating to exchanges, VOIP protocols, messaging and communication. As a serial entrepreneur and founder of seven New York-based startups, Alex has raised more than $ 1 billion and sold over $ 3 billion. Alex is the CEO and Founder of The Celsius Network, a crypto lending platform founded in 2017 that provides curated services to members that are not available through traditional institutions.