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Robinhood Purchases Pluto to Provide AI-Powered Investment Advice

Trading platform Robinhood is acquiring artificial intelligence (AI) research service Pluto Capital.

The purchase, as Bloomberg News reported Monday (July 1) is designed to offer Robinhood’s users more tailored investment strategies and analysis with the help of Pluto’s AI-driven personalized advice and real-time analytics. 

“They have built an impressive platform that is highly regarded in the financial services industry,” Mayank Agarwal, Robinhood’s vice president of engineering, told Bloomberg. “Their expertise in artificial intelligence coupled with a mission-aligned passion to democratize finance will complement our team’s effort to bring AI-powered tools to our customers.”

As Bloomberg noted, Robinhood has in recent years begun offering new services such as cryptocurrency, retirement products and credit cards. 

Still, it has remained focused on average retail investors. With the Pluto acquisition, the company can now analyze updated market information and a consumer’s own portfolio to provide investment recommendations. It’s a type of individualized advice typically only wealthier investors have access to, and Pluto Capital founder and CEO Jacob Sansbury told Bloomberg he’s wanted to change that.

“There will be no thresholds or no gates,” he said in an interview. “It’s very important for us to give access very democratically to everyone.”

The acquisition comes weeks after Robinhood said it was acquiring the cryptocurrency exchange Bitstamp for $200 million.

“Acquiring a global exchange will significantly accelerate Robinhood Crypto’s expansion worldwide,” the company said in a news release June 6. “Bitstamp holds over 50 active licenses and registrations globally and will bring in customers across the EU, U.K., U.S. and Asia to Robinhood.”

According to the release, the purchase of Luxembourg-based Bitstamp marks Robinhood’s first institutional business, providing it access to Bitstamp’s other institutional offerings such as white label solution Bitstamp-as-a-service, institutional lending, and staking.

Elsewhere in the AI sector, PYMNTS on Monday explored the concept of “AI alignment,” or the challenge of making sure AI systems perform in beneficial ways that align with human values. 

“The stakes of AI alignment for the business world are rapidly coming into focus,” that report said. “With companies across sectors racing to integrate AI into core operations, experts warn that poorly aligned AI systems could wreak havoc on bottom lines and consumer trust. Recent incidents have highlighted these risks, from AI-powered chatbots leaking sensitive customer data to facial recognition systems showing racial bias.”

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