3 ms·
Settlement isn't an effective fraud mitigation, or even operating in the right part of the system for it. By all means allow users to set such delays if they w
by ska 6y ago
Settlement isn't an effective fraud mitigation, or even operating in the right part of the system for it.
By all means allow users to set such delays if they want them, but the technology enforcing T+N really isn't a feature for customers so reframing it as such is probably a bad approach.
- someguydave 6y agoNot only that, settlement delay can cause fraud or the appearance of fraud. In the robinhood case (if they are telling the truth), then the exchange had to front its own cash for unsettled transfers. Furthermore, if there was instant settlement the idea of “shorts” changes: you could still borrow a stock but it is super clear who is holding it at a given moment, and how many are held by whom.