Robinhood weighs the scrapping of its iconic confetti animation after shut scrutiny
Robinhood Markets is contemplating whether or not to take away its iconic confetti animation after issues that the favored buying and selling app would possibly sound an excessive amount of like a sport, in response to folks conversant in the matter.
The animation has come to represent the Silicon Valley firm, nevertheless it’s additionally a lightweight bar for watchdog critics nervous about how investing apps like Robinhood induce compulsive conduct.
A Robinhood spokesperson declined to remark.
Robinhood has been within the limelight a number of occasions over the previous 12 months because it attracted thousands and thousands of recent prospects with its glossy interface, gaining followers and detractors alongside the best way. However on the finish of January, it got here below extra scrutiny after cracking down on buying and selling in “meme” shares like GameStop Corp. following a Reddit-inspired funding spree.
Within the fallout, CEO Vlad Tenev appeared earlier than Congress final month. Since then, the corporate has not ceased to arouse criticism. Gary Gensler, who’s President Joe Biden’s alternative to go the US Securities and Alternate Fee, referred to as consideration to the app – with out particularly naming Robinhood – in remarks to the Senate Banking Committee on Tuesday.
“The expertise has offered higher entry, nevertheless it additionally raises attention-grabbing questions,” Gensler advised lawmakers. “What does it imply when balloons and confetti are falling and you’ve got behavioral prompts to get traders to do extra trades?”
Past utilizing animation to have a good time a person’s first change, Robinhood has used it as a branding picture of their promoting. One advert marketed “a brand new form of investor,” displaying folks distracted at dinner or in a convention room, tapping on their telephones and receiving a bathe of inexperienced confetti.
Lawmakers additionally seemed on the characteristic movie throughout the February 18 Home Monetary Providers Committee listening to on the GameStop saga, through which Tenev testified. Rep. Cindy Axne, Democrat from Iowa, urged him to justify it.
Tenev replied that at Robinhood, “we do not imagine in gamification” and “we all know investing is severe.”
When Massachusetts monetary regulators filed a lawsuit in opposition to Robinhood final 12 months, accusing the app of encouraging frequent buying and selling with reckless animations like confetti, the corporate defended itself.
“Confetti does not present up after each transaction,” Robinhood stated in response to the grievance. “So the confetti has, actually, nothing to do with frequent exchanges.”
“There may be nothing fallacious with app options like confetti, and the Division’s try and outline confetti as dishonest or unethical displays a distinctly outdated view of communication within the digital age.” , did he declare.