Hey guys, it's sasha for those of us who live outside the u.s trading 202 has become one of the most popular investing platforms over the past couple of years. They seem to have gone from absolutely nowhere to having over 1.4 million customers as of the beginning of 2021 and their assets under management grew by 5, 300 percent in just 12 months. But then, at the end of january, everything stopped as the game saga unfolded. Trading 202 halted the acquisition of new accounts on the 28th of january due to, in their words, unprecedented demand.

They said that once we process the existing queue, we will be opened up to new registrations and yet that queue was never processed and new account registrations were never opened here. We are in june over four months since that point, and you can still not go and open a new account with trading to one two. This has gone from being interesting and curious when it first happened due to it being quite unusual to being somewhat concerning, because it is extremely unusual to go and stop acquiring new customers, especially for this long for a fast growing company. Unless there is an extremely compelling reason to do so well, let me share a few details that i think will make you find this even more interesting and perhaps somewhat concerning just like how i feel about it.

This by the way is coming from someone who actually really likes trading 212.. I personally use it a lot. I use it in live videos. I hold most of my personal investments with trading 202 because of the quality of the platform and the low fees that they have.

So i actually would really like them to go and get all of this stuff fixed. But we need to discuss this on the 4th of february, exactly a week after new accounts were suspended, trading 202 went and opened up their waiting list. So anyone who has tried to sign up ever since has just gone and sat on that waiting list, and there is no date as to when those accounts might actually be opened. On the same day.

Tony v, who is a trading 202 representative in their community, said the new account opening was paused until we increased our capacity to serve more clients. Furthermore, huge scalability improvements are coming in a nutshell. Delivering great service to our clients is our top priority. Well, that sounds great, but since then there has been absolutely no update of any kind at all.

Every now and then tony or one of the other staff members from trading 202 would come back and say that they still don't have an update. No more details, no explanations and absolutely no date when they expect this to reopen and you'd expect that a platform that has had to pause, acquiring new customers because of the severity of these upgrades that they are working on, would obviously have to mean that they're going To pause any other developments, because if you are working flat out on a new system, you don't want to go and add new stuff to the old system that you're then going to have to go and port to this new platform. Well, in april trading 202 introduced there not 0.15 for an exchange fee in the platform as the new tax year started, and many people, including myself, thought that that is when they're gon na go and reopen new accounts, because now the fee is in now you can Go and begin booking new accounts, but their doors remain shut, they've, also upgraded their price feature to enable linking and added a new feature called communities where people can go and discuss their favorite stocks. So they are releasing tech upgrades on an ongoing basis.

So if the issue really was the fact that too many people were looking to sign up, why are new accounts not being allowed to onboard now we'll take a look at this on the same day, the trading 202 stopped booking new accounts. Curiously, they also published their company accounts for 2019.. In those accounts there is a section on page 32, which is called events after the reporting period, and in that section there are a few paragraphs about covid and at the end it says other than that no matter or circumstances has arisen since 31st december 2019. That has significantly affected or may significantly affect the group's operations, the results of those operations or the group's state of affairs in future financial years.

Interesting right, why did they publish this on the exact same day that they stopped taking new accounts, because presumably stopping new accounts for a prolonged period of time would be something material that happened after that reporting period? Well, more importantly, companies have to submit accounts to companies house nine months after the end of the financial year, so trading 212 should have submitted them at the end of september 2020. According to that requirement, but for some reason they delayed by four months and then happened to just publish them on the same day that they went and closed new accounts. Then in march, barely a few weeks. After all, this happened.

The ceo of trading 212 quit. He left the company, just as the company has gone through an explosive year of growth and is doing really well. The ceo nick saunders just decided to leave with no official statements, no official confirmations and only rumors that he decided he wasn't the right person to deliver the growth. You know, despite being the person that delivered the biggest growth of any investing platform in the previous year and in april he joins another trading platform in london as head of cash equities from being a ceo, the fastest growing one just a few weeks earlier, a rather Curious career move, wouldn't you say now in may: trade2 appointed muka chowdhury as the new ceo, but we've heard absolutely nothing yet as to what trading 212 is doing or whether there's any change of direction.

So here's the bottom line that i think is really important. Some tech upgrades do require a lot of work. I appreciate that, especially as building the back end, the tech and the entire strategy behind financial services products is literally what i've been doing. My entire career, i get it, but we're talking a capacity upgrade here, rather than a fresh, build from scratch of an entire platform according to trading 212 themselves and four months and counting after they stopped.

The new accounts is a pretty long time to go and deliver something like that in the world of fintech, especially as demand has now dropped again. So seeing a strategy are refusing to acknowledge the issue or provide any meaningful updates reasons or any kind of information. As to what's actually going on, what could the reasons be? Theoretically, let's talk about it. One reason could be that some kind of a system flaw or a major issue was identified by trading 212 requires a complex fix and a potential redress of existing accounts.

This sort of thing is possible and does happen from time to time, even with big financial companies, and it can take quite a substantial amount of time, depending on the specific issue, to go and resolve something like this. It can be really painful what if the shares of people buying were, for example, just completely hypothetically, not properly allocated and interactive brokers or historic transactions didn't quite accurately split fractional share ownership in the systems or anything else like that. Now, i'm obviously just speculating here, but an issue of this type would naturally result in a long gap. If that was to happen, because you would want to stop new accounts joining to stop the problem getting even bigger, but you wouldn't be able to just stop all existing accounts from continuing to trade and manage their investments, because if you were to do that, you would Immediately, go and kill your entire business, probably forever.

So if that sort of thing was to hypothetically be the case, the current course of action that they're taking is exactly what you would expect to be happening. Another potential issue could be theoretically some kind of a regulatory problem if the fca say came to trading 202 and said that there were some issues that they needed to go and address and fix and change in their operation. There is a possibility that the fca would ask trading 212 to stop on boarding new accounts until those issues have been addressed, and this actually does happen from time to time. In financial services is quite often the request, the fca actually do make in these cases, and that could be a hard enforcement and the scrutiny could have happened during the gme saga, but without trading into actually confirming anything about the reasons for what they're doing it is Impossible to really know whether this could be the case.

Another possible case here is brexit, which concluded just before. All of this happened at the end of 2020 as uk and european customers were all previously, bundled together into a single legal entity. There may now be theoretically some issues with non-uk customers where those customers should legally be actually registered. This could affect things in a big way if the uk regulator, for example, determines that non-uk customers should not fall under fscs protection, but, for example, they require separate eu licenses that are not currently held.

That would mean that a load of customers will be falling through the cracks in an email. The end of december to non-uk customers trading 202 said that all uk regulations and protections would continue to apply, but is that accurate? Is that correct? Can non-uk residents genuinely apply and use the product that is regulated by the fca and that continues to benefit from all the benefits of fscs etc? Well, that is certainly not the case with any other investing app which either do not operate in other european countries if they operate in the uk or don't operate in the uk if they operate in other european countries or when they operate in both, they have a License in the uk and a separate license and a separate entity that is regulated in europe where european customers are being treated and if trading 202 needed one of those european licenses. That is a process that could easily take quite a long time. You know a few months during which you'd be waiting for it to complete, if you were trading 212 and planning how to then go and switch existing non-uk customers over to this new entity, for example.

Now, all of these are just pure speculation, they're, just some random thoughts, they're, absolutely no factual basis, but they all weirdly sound far more plausible than the official tech upgrade reason that we keep hearing, and that is somewhat concerning. I really hope that trading on two have fixed whatever issues they are having or will fix whatever issue they're having because confidence in the platform is eroding really fast, and if it is really that capacity upgrades that they are working on. I am really looking forward to seeing what it is they're going to be bringing out, because after this amount of time, it is probably going to be incredibly spectacular. If you find this useful, please don't forget to hit the like button for the youtube algorithm.

Thank you. So much for doing so. Thank you very much for watching all the way through and i'll see you guys later. You.