They "lend" you money to buy assets they hold, up to 2x. There's essentially zero risk for them. They don't lend you money you can cash out to your account. Yo

They "lend" you money to buy assets they hold, up to 2x. There's essentially zero risk for them. They don't lend you money you can cash out to your account. You buy $1000 of stock with your cash. They say cool your account can now "borrow" $1000 from us to buy more stock. If your stocks start crashing, they margin call and get their money back. The assets are always in their account, no risk to them. The only real risk is probably fraud. Sign up with stolen account A, cash out to mule account B. This happens a ton and for small amounts no one is gonna follow up on it, so it's up to Robinhood to detect and prevent this ahead of time.