As Fintech Springs To Life, Bank Branches Die Slow Deaths

What Happened: That speaks to the disruption being caused by the fintech industry and plenty of components in the high-flying ARK Fintech …

Bolstered by the likes of Square SQ, -0.65% and PayPal PYPL, +0.95% — companies that remove the need for customers to have traditional bank accounts, let alone spend time going to a physical branch — ARKF is up more than 76% year-to-date.

Why It’s Important: Physical banking is ripe for disruption like so many other industries, and that disruption is being accelerated by the coronavirus pandemic.

Common sense dictates if going into a bank — where there are likely other people — can be avoided, why not avoid it?

Much like e-commerce, cloud computing and other disruptive technologies, fintech was, well, disrupting before the pandemic . The data on bank branches confirms as much.

“After tracking the usage of financial services across demographic factors such as income, occupation, and age between 2013 and 2017, the Federal Deposit Insurance Corporation (FDIC) reported a drop in the use of bank branches and an increase in digital and mobile banking,” according to ARK Invest research.

Banks are up against it when comes to competing against digital wallets like PayPal and Square on cost.

ARKF’s issuer estimates those companies spend just $20 to acquire each of their customers, while a brick-and-mortar bank spends $1,000 a head.

What’s Next: While some ARKF components and other fintech companies are trying to get traditional bank charters, that doesn’t mean they’ll be opening vast networks of branches.

The data shows they probably should eschew that idea.

As of 2018, it costs $550,000 to run a single bank branch, according to ARK Invest.

To put that staggering sum into context, it’s a nice house in most of ex-California, ex-New York America. Or: $550,000 would buy 2,941 shares of Square, ARKF’s top holding.

“In our view, the 77,000+ bank branches in the US represent an untenable commitment to acquire customers for roughly $1,000 on average and monetize them,” said ARK.

What is tangible is that fixed and sunk costs are meaningful for investors. ARKF is up more than 76% year-to-date, but the S&P Banks Select Industry Index is lower by 32%.

Disclosure: Todd Shriber owns shares of Square.

Courtesy photo.

© 2020 Benzinga does not provide investment advice. All rights reserved.

New York Agency Makes Case for Social Media Oversight

The agency slammed the social media giant for letting itself be duped by a “simple” social engineering technique after a Florida teen allegedly …

(TNS) — New York’s Department of Financial Services is calling for greater cybersecurity oversight for social media companies in a report detailing a major hack targeting Twitter.

The agency slammed the social media giant for letting itself be duped by a “simple” social engineering technique after a Florida teen allegedly orchestrated the July 15 attack which saw accounts, including those of Tesla head Elon Musk and former President Barack Obama, used to steal more than $118,000 worth of cryptocurrency from Twitter users.

“Social media platforms have quickly become the leading source of news and information, yet no regulator has adequate oversight of their cybersecurity,” said Superintendent of Financial Services Linda Lacewell. “The fact that Twitter was vulnerable to an unsophisticated attack shows that self-regulation is not the answer.”

The report recommends an oversight council be established to “designate systemically important social media companies” and says a regulator should be appointed to “monitor and supervise” the security practices of mainstream social media platforms.

The state’s investigation found that the hackers broke into Twitter’s internal systems by calling employees and claiming to be from the company’s tech department, tricking four employees into handing over their log-in credentials.

Hackers then accessed the Twitter accounts of politicians and celebrities, including Kim Kardashian West, Jeff Bezos, Musk and others to tweet out a scam to millions of users.

Twitter confirmed that a “phone spear-phishing” attack was used to gain credentials after the attack.

The scam tweets, which promised users could “double your bitcoin,” contained links allowing payments in bitcoin and led to more than $118,000 being stolen.

Gov. Cuomo said the report “demonstrates a regulatory gap that must be filled if we are to protect our financial and political systems from cyberattacks and misinformation campaigns.”

“Americans increasingly use and rely on these social media platforms, which means there is no room for weak leadership, systemic errors or flawed cybersecurity when it comes to protecting users and content,” he added.

“New York will not hesitate to take the lead with responsible measures that protect our citizens, our systems and our democracy.”

©2020 New York Daily News, Distributed byTribune Content Agency, LLC.

Looking for the latest gov tech news as it happens? Subscribe to GT newsletters.

Tesla (TSLA) price target boost from Goldman Sachs reflects strong Q3 Earnings expectations

Analyst Mark Delaney boosted his price target from $400 to $450, making it the second time this month that Goldman Sachs has increased its outlook on …

Tesla (NASDAQ: TSLA) received a boosted price target from Wall Street firm Goldman Sachs on Wednesday morning. Analyst Mark Delaney boosted his price target from $400 to $450, making it the second time this month that Goldman Sachs has increased its outlook on the electric automaker’s stock.

Delaney also boosted his price target from $295 to $400 on October 5th.

According to, Delaney maintained a “Neutral” rating on TSLA shares, but also believes that automotive companies with high exposure, like Tesla, are capable of reporting strong earnings for Q3 based on recent industry data and company commentary.

In terms of “high exposure” automotive companies, there are few that top Tesla. With the increasing popularity of electric cars, Tesla is without a doubt the industry leader. The company offers best-in-class electric transportation and the best prices on the market.

Tesla CEO Elon Musk is also widely popular among owners, enthusiasts, and tech-interested people throughout the world. His intelligence, coupled with the desire to make his company’s cars a little bit better every day, has revolutionized the way automotive companies look at their consumer bases.

Operating extremely different from legacy automotive companies, Tesla has used consumer suggestions to improve its vehicles on several occasions.

Delaney holds high regard for the U.S. automotive market in 2020, forecasting 14.3 million sales for the year. Previous estimates from the Goldman analyst suggested 13.4 million, but a rebound from the slump in early 2020 due to the COVID-19 pandemic has slowed significantly.

Tesla plans to deliver 500,000 of the 14.3 million cars that Goldman is forecasting for 2020. The company announced a record number of deliveries for Q3, with 139,300 electric cars making their way to owners during the three-month-span. The Model 3 and Model Y, Tesla’s two mass-market vehicles, dominated the delivery figures with 124,100 of the 139,300 deliveries.

Tesla is also planning to ramp up its production and deliveries through the next few years in the U.S. This plan starts with more efficient manufacturing at the Fremont facility in Northern California. However, the company is currently in the process of building a new production plant in Austin, Texas, that will produce the Cybertruck, Model 3, Model Y, and Semi.

Mark Delaney holds a 64% success rating and an average return of 9.4%, according to TipRanks. At the time of writing, TSLA stock was trading at 4$459.44, up 2.88% for the session.

Disclaimer: Joey Klender is a TSLA Shareholder.

How Strong Are Elon Musk’s 10-Cent Bricks?

How Strong Are Elon Musk’s 10-Cent Bricks? The Boring Company is turning the dirt from its underground tunnels into bricks. But are they actually …

    “Why is Elon building bricks?” the host of YouTube’s What’s Inside? asks in a new video. The answer: By turning waste dirt from The Boring Company’s tunnels into bricks, Musk says, he can sell low-cost building materials that will also help subsidize the cost of the tunnel.

    ➡ You can’t get enough Musk. Neither can we. Let’s nerd out over his creations together.

    Let’s watch as the What’s Inside guys test the bricks for quality and durability.

    This content is imported from YouTube. You may be able to find the same content in another format, or you may be able to find more information, at their web site.

    “These are supposed to sell for 10 cents a brick,” host Dan Markham says. That’s super cheap, and Musk has said that bricks earmarked for affordable housing projects will be available for free. But the first batch of Boring Company bricks wasn’t quite perfect, so Musk gave them away internally. While a Boring brick may not be quite as sentimental as a brick from, say, Old Comiskey, it’s still an instant collector’s item.

    And to that end, Markham bought two of these bricks for $200 each. If an average red clay brick costs 75 cents at a home renovation store (the one Markham shows and uses is 53 cents, but prices and styles vary), that means the production Boring brick will cost about 1/8th of that, and Markham’s costs about 270 times more.

    This content is imported from {embed-name}. You may be able to find the same content in another format, or you may be able to find more information, at their web site.

    Markham puts the Boring brick up against a new red clay brick, a used red clay brick, a cinderblock-style brick with what look like prestress wires through the middle, and a plain cinderblock brick. Musk, Markham explains, has claimed that his innovative, but extremely low-cost brick will even be much more durable than traditional bricks. The only way to find out, of course, is to drop them from great heights.

    The cinderblock and used red brick don’t even survive the very first test, a chest-high drop onto Markham’s cement patio. (He marvels at the slightly higher cost of the used brick, but that extra cost may be in the labor of recovering and recycling the brick, not anything to do with its quality.)

    “Oh, this one is hard to do,” Markham says, cringing, as he drops the $200 brick from higher and higher positions. The traditional red clay brick finally breaks after an underhand toss off the very top of a stairway over the patio, and the Boring brick makes it one step further: a high-arcing toss.

    This video is cool, and we love the idea of low-cost building materials made by innovative recycling. But we’d be curious to see a scientifically rigorous version of the test, because so much of whether these materials break is affected by weird things like the angle at which they hit the ground. Simply dropping from the same height without more control isn’t enough.

    But for $200 a brick, at least for now … we’ll have to wait on further studies.

    This content is created and maintained by a third party, and imported onto this page to help users provide their email addresses. You may be able to find more information about this and similar content at

Exclusive: Virgin Hyperloop picks West Virginia to test high-speed transport system

Elon Musk’s Boring Company envisions commuters zipping along underground tracks in electric cars. Virgin Hyperloop picked West Virginia after …

By Eric M. Johnson

SEATTLE (Reuters) – Virgin Hyperloop has picked the U.S. state of West Virginia to host a $500 million certification center and test track for billionaire Richard Branson’s super high-speed travel system, the company told Reuters.

The center will be the first U.S. regulatory proving ground for a hyperloop system designed to whisk floating pods packed with passengers and cargo through vacuum tubes at 600 miles (966 kmph) an hour or faster.

An announcement, expected on Thursday, will include a press conference with U.S. Transportation Department Secretary Elaine Chao, Branson and U.S. Senators from West Virginia Shelley Moore Capito, a Republican, and Joe Manchin, a Democrat.

In a hyperloop system, which uses magnetic levitation to allow near-silent travel, a trip between New York and Washington would take just 30 minutes. That would be twice as fast as a commercial jet flight and four times faster than a high-speed train.

Construction is slated to begin in 2022 on the site of a former coal mine in Tucker and Grant Counties, West Virginia, with safety certification by 2025 and commercial operations by 2030, the company said.

Federal regulators will use the center, and accompanying six-mile test track, to establish regulatory and safety standards, while Virgin will test its product and infrastructure.

It comes less than three months after the Transportation Department published guidance on a regulatory framework for U.S. hyperloop systems.

Virgin Hyperloop, which has raised more than $400 million, largely from United Arab Emirates shipping company DP World and Branson, is among a number of firms racing to launch new high-speed travel systems.

Canada’s Transpod and Spain’s Zeleros also aim to upend traditional passenger and freight networks with similar technology they say will slash travel times, congestion and environmental harm linked with petroleum-fueled machines.

Elon Musk’s Boring Company envisions commuters zipping along underground tracks in electric cars.

Virgin Hyperloop picked West Virginia after reviewing applications from 17 U.S. states to host the center.

However, the company’s most likely first route could be in India, linking Mumbai to Pune, though the COVID-19 pandemic has delayed procurement and construction, initially slated for 2020.

Virgin Hyperloop also has a research and development test track near Las Vegas, Nevada.

(Reporting by Eric M. Johnson in Seattle; Editing by David Gregorio)