Trading 212 plans to transfer 14% of clients to Cyprus, UK revenue soars to £124mln

abdelaziz Fathi

An unprecedented boom in retail trading helped Trading 212 earn handsome fees from its clients’ trades, resulting in a 300% jump in revenue of the fiscal year ending December 31, 2020.

Trading 212

Per its filing with the UK companies house, the FCA-regulated broker said revenue from online trading jumped to £124 million. This figure more than quadrupled from less than £30 million in the year earlier.

The solid revenue was, however, offset by soaring operational costs which increased fivefold during the period. The expenses were reported at £113 million in the FY 2020 compared to £19 million the previous year. As a result, Trading 212 earned £10.1 million, up 40% over a yearly basis from £8.5 million in 2019.

“External factors have also contributed to the significant demand for T212’s services and include both the well-publicised surge of public interest in the stock markets seen in early 2021 as well as the COVID pandemic. This demand has translated into increased account openings, transaction volumes, and significant increases in both new and existing user activity,” the company said.

These metrics might raise questions about the sustainability of revenues and how long the bumper capital markets environment will last. However, Trading 212 said that demand for its products and services continued into 2021 with revenues and profitability for the FY 2021 having grown significantly.

Trading 212 resumes client onboarding

Trading 212 also highlighted that it had temporarily halted the on-boarding of new users as its platform came under pressure to keep up with the huge growth in retail investing, which caused severe operational difficulties. The company has, since February 14, re-commenced the daily onboarding of a limited number of customers, with the intention to resume full onboarding thereafter.

“With much of this exceptional growth coming in the UK trading entity, there became a need for the UK Board to, voluntarily and temporarily, pause onboarding and reflect on the firm’s strategy and operating model, including the current systems, capacity and controls in place, to ensure that they remain appropriate for the size and scale of the growing business,” it said.

London-based fintech was one of several platforms, including Robinhood and IG Group, that experienced outages as the number of retail trades soared in wild days for the markets. The service disruptions came during a period of frenetic trading, where Reddit users were accused of inflating the price of GameStop, AMC, Blackberry, Nokia and other meme stocks.

Trading 212 was the first retail UK broker to offer commission-free trading and its core product portfolio consists of stocks, ETFs, FX, and derivatives products.

Outside of the UK entity, and following Brexit, Trading 212 plans to transfer some of its clients around the group. This will see the UK entity transferring circa 14% of its clients (all being EU clients) to the new Cyprus entity, while the Bulgarian entity will also be transferring its client to either the Cyprus or UK entity.

Read this next

Metaverse Gaming NFT

Despite crypto winter, Fastex grabs $23.2 million in Fasttoken token sale

Fasttoken, part of the Fastex web3 ecosystem, has secured $23.2 million in financing through the private and public token sales of its native cryptocurrency Fasttoken (FTN).

Digital Assets

Iran to repay Russian debts in gold-backed stablecoins

A high-ranking member of the Russian parliament confirmed reports that his country was in talks with Iran to create a stablecoin for foreign trade settlements, to replace the dollar, ruble and Iranian rial.

Digital Assets

SEC denies Cathie Wood’s bitcoin ETF for second time

The approval of a regulated crypto derivative is still looking far less likely, as the US regulators have once again denied Cathie Wood’s application for a long-awaited spot bitcoin exchange-traded fund (ETF).

Executive Moves

Pavel Spirin promoted to Scope Markets CEO following Rostro acquisition

Belize-based FX and CFDs brokerage Scope Markets has promoted Pavel Spirin to take on an expanded role as the company’s chief executive officer. He replaces the outgoing CEO Jacob Plattner, who has also been a major shareholder since he resigned his position as managing director at GKFX.

Retail FX goes all-in on alternative investing, launches Rare Sneaker Portfolio

“The concept of curated Portfolios means that our members will be able to invest in categories like art, trading cards, royalties, and real estate without needing to become subject matter experts on individual assets.”

Industry News

State Street taps AWS and Microsoft for cloud and infrastructure solutions

“By standardizing and simplifying our technology operating model, we will be able to more quickly deploy client environments and launch new products and services, while continuing to enhance the resiliency of our technology environment and our business operations.”

Institutional FX

Bitpanda launches Investment-as-a-Service business for banks, fintechs, online platforms

“Financial institutions today have to ask themselves how they aim to cater the increasing demand for modern investing solutions. Building these Individually, means a high startup cost, and products that are often outdated before they are even launched.”

Institutional FX

Options expands market data feeds after partnership with Tools for Brokers

“Our integration with ACTIV Financial marked the beginning of a new era in market data availability and infrastructure. Our teams have come together to provide unparalleled, fully managed market data services alongside Options’ global connectivity and infrastructure.”

Industry News

Recruitment in financial services sector buoyant despite planned mass layoffs

“It remains to be seen what impact this will have on hiring levels within the financial services arena this quarter”, said APSCo, regarding the expected mass layoffs within the financial services sector in England & Wales.