During Thursday’s GameStop hearing, Citadel Securities’ Ken Griffin defended a controversial method brokerages use to make money, and said his firm would adapt if new regulations prohibited the practice.
Lawmakers finally got a chance to press Robinhood, Citadel and Reddit chiefs about the GameStop trading controversy.
Members of Congress spent much of their time prodding about “payment for order flow,” a practice in which a brokerage receives payment from a market maker, known as a dealer, for directing the order to them.
This model is how Robinhood and other brokers are able to have commission-free trading.
Robinhood made more than $221 million from payment for order flow in the fourth…