<PAGE>

                                                                     EXHIBIT 3.1


               AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
                                      OF
                               WEB STREET, INC.
                               ----------------

                 Originally incorporated on December 31, 1997.


     Web Street, Inc., a corporation originally incorporated on December 31,
1997 under the name Web Street Financial Group, Inc. (the "Corporation") and
organized and existing under, and by virtue of, the General Corporation Law of
the State of Delaware (the "DGCL"), does hereby certify that this Amended and
Restated Certificate of Incorporation of the Corporation (the "Certificate of
Incorporation") set forth below has been duly adopted in accordance with
Sections 242 and 245 of the DGCL.


                                  ARTICLE I.
                                  ----------

     The name of the Corporation is Web Street, Inc.


                                  ARTICLE II.
                                  -----------

     The address of the Corporation's registered office in the State of Delaware
is 1013 Centre Road, Wilmington, County of New Castle, Delaware 19805.  The name
of the Corporation's registered agent at such address is Corporation Service
Company.


                                 ARTICLE III.
                                 ------------

     The nature of the business to be conducted or promoted by the Corporation
is to engage in any lawful act or activity for which corporations may be
organized under the DGCL.


                                  ARTICLE IV.
                                  -----------

     A.   Authorized Capital Stock.
          ------------------------

     The Corporation shall have authority to issue 102,000,000 shares of capital
stock, consisting of (i) 100,000,000 shares of Common Stock, par value $0.01 per
share ("Common Stock"), and 2,000,000 shares of Preferred Stock, par value $0.01
per share ("Preferred Stock").
<PAGE>

     B.   Designations and Rights.
          -----------------------

     The designations and the powers, preferences and relative, participating,
optional or other rights of the capital stock and the qualifications,
limitations or restrictions thereof are as follows:

          1.   Common Stock.  Except as otherwise provided in this Section B.1.
               ------------
     or as otherwise required by applicable law, all shares of Common Stock
     shall be identical in all respects and shall entitle the holders thereof to
     the same rights and privileges, subject to the same qualifications,
     limitations and restrictions.

               a.   Voting Rights:  Except as otherwise required by law or
                    -------------
          expressly provided herein, the holders of Common Stock shall vote as a
          single class and be entitled to one (1) vote per share on each matter
          submitted to a vote of the stockholders of the Corporation.

               b.   Dividends:  Subject to the rights of the holders, if any, of
                    ---------
          Preferred Stock, the holders of Common Stock shall be entitled to
          receive dividends at such times and in such amounts as may be declared
          thereon by the Board of Directors of the Corporation (the "Board of
          Directors") and shall share equally on a per share basis in all such
          dividends.

               c.   Liquidation Rights:  In the event of any liquidation,
                    ------------------
          dissolution or winding up of the Corporation, whether voluntary or
          involuntary, after payment or provision for payment of the debts and
          other liabilities of the Corporation and the preferential amounts to
          which the holders of any outstanding shares of Preferred Stock shall
          be entitled upon dissolution, liquidation or winding up, the assets of
          the Corporation available for distribution to stockholders shall be
          distributed ratably among the holders of the shares of Common Stock.

          2.   Preferred Stock.  Preferred Stock may be issued from time to time
               ---------------
     in one or more series.  Subject to the other provisions of this Certificate
     of Incorporation and any limitations prescribed by law, the Board of
     Directors is authorized to provide for the issuance of and issue shares of
     the Preferred Stock in series and, by filing a certificate pursuant to the
     laws of the State of Delaware, to establish from time to time the number of
     shares to be included in each such series and to fix the designation,
     powers, preferences and rights of the shares of each such series and any
     qualifications, limitations or restrictions thereof.  The number of
     authorized shares of Preferred Stock may be increased or decreased (but not
     below the number of shares thereof then outstanding) by the affirmative
     vote of the holders of a majority of the total voting power of Common
     Stock, without a vote of the holders of any Preferred Stock, or of any
     series thereof, unless a vote of any such holders is required pursuant to
     the certificate or certificates establishing such series of Preferred
     Stock.

                                      -2-
<PAGE>

          The corporation has designated 500,000 shares of Preferred Stock as
     Series A Preferred Stock (the "Series A Preferred").

               a.  Voting Rights:  Holders of the Series A Preferred shall have
                   -------------
          four (4) votes per Series A Preferred share, and at all times shall
          have four (4) times the vote of the Common Stock on a per share basis.
          The Series A Preferred will not be entitled to participate in the
          profits of the Corporation beyond the Liquidation Preference (as
          defined below) of the Series A Preferred and dividends on the Series A
          Preferred when declared.

               b.  Dividends:  Dividends will be payable only as and when
                   ---------
          declared on the Common Stock in a ratio of $4.00 of dividend for each
          Series A Preferred share per $1.00 of dividend on each share of Common
          Stock.  No dividend may be declared on any Common Stock until all
          declared and unpaid dividends on the Series A Preferred have been paid
          in full.  Dividends not declared on the Series A Preferred in a given
          year will not be paid and will not cumulate.

               c.  Liquidation:  In the event of a voluntary or involuntary
                   -----------
          liquidation of the Corporation, the holders of the Series A Preferred
          shall be entitled to first receive $10.00 per share of Series A
          Preferred (the "Liquidation Preference") plus a sum equal to all
          dividends theretofore declared which at such time are unpaid.  Such
          Liquidation Preference shall have priority over the liquidation
          preference(s), and any other rights to distributions on shares, of
          holders of Common Stock and all other classes of Preferred Stock of
          the Corporation.

               d.  Transfers:  The Series A Preferred will not be transferable
                   ---------
          without a written opinion from counsel to the Corporation that any
          such transfer will not violate any applicable securities laws or
          regulations.

               e.  Conversion:  Each of the Series A Preferred will be
                   ----------
          automatically converted into four (4) fully paid and nonassessable
          shares of Common Stock of the Corporation upon the completion of a
          public offering of the Common Stock of the Corporation, or upon the
          sale of all or substantially all of the assets of the Corporation, or
          upon the sale of shares (or series of such sales) constituting in the
          aggregate more than fifty (50%) percent of the voting shares of the
          Corporation.

               f.  Required Consent:  No shares of Series A Preferred may be
                   ----------------
          issued to anyone other than the holders of Series A Preferred  without
          the consent of such holders.

                                      -3-
<PAGE>

                                  ARTICLE V.
                                  ----------

     The business and affairs of the Corporation shall be managed by, or under
the direction of, a board of directors consisting of not less than three (3) nor
more than nine (9) directors.  The exact number shall be determined from time to
time by resolution adopted by the affirmative vote of a majority of the
directors in office at the time of adoption of such resolution.  Initially, the
number of directors shall be five (5) and shall consist of the following
persons: Joseph J. Fox, Avi Fox, D. Jonathan Rosenberg, Robert F. Bernard and
Fredric J. Graber.

     The directors shall be divided into three classes, Class I, Class II and
Class III with each class having as equal a number of members as reasonably
possible.  Class I shall initially consist of the following directors: D.
Jonathan Rosenberg and Fredric J. Graber.  Class II shall initially consist of
the following directors: Robert F. Bernard and Avi Fox.  Class III shall
initially consist of the following director: Joseph J. Fox.  The initial term of
office of the Class I, Class II and Class III directors shall expire at the
annual meeting of stockholders of the Corporation in 2000, 2001 and 2002,
respectively.  Beginning in 2000, at each annual meeting of stockholders of the
Corporation, successors to the class of directors whose term expires at that
annual meeting shall be elected for a three-year term.  If the number of
directors is changed, any increase or decrease shall be apportioned among the
classes by the Board of Directors so as to maintain the number of directors in
each class as nearly equal as is reasonably possible, and any additional
director of any class elected to fill a vacancy resulting from an increase in
such class shall hold office for a term that shall coincide with the remaining
term of that class.  In no case will a decrease in the number of directors
shorten the term of any incumbent director, even though such decrease may result
in an inequality of the classes until the expiration of such term.  A director
shall hold office until the annual meeting of stockholders of the Corporation in
the year in which his or her term expires and until his or her successor shall
be elected and qualified, subject, however, to prior death, resignation,
retirement or removal from office.  Directors may only be removed for cause,
except as otherwise provided by law, by the holders of at least sixty-six and
two-thirds percent (66/2/3%) of the voting power of the shares entitled to vote
generally in the election of directors.  Except as required by law or the
provisions of this Certificate of Incorporation, all vacancies on the Board of
Directors and newly-created directorships shall be filled by the Board of
Directors.  Any director elected to fill a vacancy not resulting from an
increase in the number of directors shall have the same remaining term as that
of his or her predecessor.

     Notwithstanding the foregoing, whenever the holders of any one or more
classes or series of Preferred Stock issued by the Corporation shall have the
right, voting separately by class or series, to elect directors at an annual or
special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the
terms of this Certificate of Incorporation and any resolutions of the Board of
Directors applicable thereto, and such directors so elected shall not be divided
into classes pursuant to this Article V. Notwithstanding anything to the
contrary contained in this Certificate of Incorporation, the affirmative vote of
the holders of at least sixty-six and two-thirds percent (66 /2/3/%) of the
voting

                                      -4-
<PAGE>

power of the shares entitled to vote generally in the election of directors
shall be required to amend, alter or repeal, or to adopt any provision
inconsistent with, this Article V.


                                  ARTICLE VI.
                                  -----------

     A.   Written Consent.
          ---------------

     Any action required or permitted to be taken at any annual or special
meeting of stockholders may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted.  Prompt notice of the taking of the corporate action without a meeting by
less than unanimous written consent shall be given to those stockholders who
have not consented in writing and who, if the action had been taken at a meeting
would have been entitled to notice of the meeting if the record date for such
meeting had been the date that written consents signed by a sufficient number of
holders to take the action were delivered to the Corporation.  Such written
consent shall be filed with the records of the Corporation.  Notwithstanding the
foregoing, however, on and after the consummation of the Corporation's first
underwritten public offering of shares of Common Stock pursuant to a
registration statement filed with the United States Securities and Exchange
Commission (or any successor thereto), any action required or permitted to be
taken at any annual or special meeting of stockholders may be taken only at a
duly called meeting and may not be taken by written consent of the stockholders
in lieu of a meeting.

     B.   Special Meetings.
          ----------------

     Special meetings of stockholders of the Corporation may be called, upon not
less than ten (10) nor more than sixty (60) days' written notice, only by (i) a
Chairman of the Board of Directors, (ii) the Chief Executive Officer of the
Corporation, (iii) the President of the Corporation or (iv) the Board of
Directors pursuant to a resolution approved by a majority of the Board of
Directors.

     C.   Amendment.
          ---------

     Notwithstanding anything contained in this Certificate of Incorporation to
the contrary, the affirmative vote of the holders of at least sixty-six and two-
thirds percent (66 /2/3/%) of the voting power of the shares entitled to vote
generally in the election of directors shall be required to amend, alter or
repeal, or to adopt any provision inconsistent with, this Article VI.

                                      -5-
<PAGE>

                                 ARTICLE VII.
                                 ------------

     In furtherance and not in limitation of the power conferred by statute, the
Board of Directors is expressly authorized to make, alter, amend or repeal the
By-laws of the Corporation (the "By-laws").  The By-laws may be altered, amended
or repealed, or new By-laws may be adopted, by the vote of a majority of the
members of the Board of Directors in accordance with the preceding sentence or
by the vote of the holders of at least sixty-six and two-thirds percent (66
/2/3/%) of the voting power of the shares entitled to vote generally in the
election of directors; provided that, if such alteration, amendment, repeal or
adoption of new By-laws is effected at a duly called special meeting, notice of
such alteration, amendment, repeal or adoption of new By-laws is contained in
the notice of such special meeting.  Notwithstanding anything contained in this
Certificate of Incorporation to the contrary, the affirmative vote of holders of
at least sixty-six and two-thirds percent (66 /2/3/%) of the voting power of the
shares entitled to vote generally in the election of directors shall be required
to amend, alter or repeal, or to adopt any provision inconsistent with, this
Article VII.


                                 ARTICLE VIII.
                                 -------------

     A director of the Corporation shall not, in the absence of fraud, be
disqualified by his office from dealing or contracting with the Corporation
either as a vendor, purchaser or otherwise, nor, in the absence of fraud, shall
a director of the Corporation be liable to account to the Corporation for any
profit realized by him or her from or through any transaction or contract of the
Corporation by reason of the fact that such director, or any firm of which such
director is a member, or any corporation of which such director is an officer,
director or stockholder, was interested in such transaction or contract if such
transaction or contract has been authorized, approved or ratified in a manner
provided in the DGCL for authorization, approval or ratification of transactions
or contracts between the Corporation and one or more of its directors or
officers or between the Corporation and any other corporation, partnership,
association or other organization in which one or more of its directors or
officers are directors or officers or have a financial interest.


                                  ARTICLE IX.
                                  -----------

     Meetings of stockholders may be held within or without the State of
Delaware as the By-laws may provide.  The books of the Corporation may be kept
outside the State of Delaware at such place or places as may be designated from
time to time by the Board of Directors or in the By-laws.

                                      -6-
<PAGE>

                                  ARTICLE X.
                                  ----------

     Whenever a compromise or arrangement is proposed between the Corporation
and its creditors or any class of them and/or between the Corporation and its
stockholders or any class of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of the
Corporation or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for the Corporation under the provisions of
Section 291 of the DGCL or on the application of trustees in dissolution or of
any receiver or receivers appointed for the Corporation under the provisions of
Section 279 of the DGCL, order a meeting of the creditors or class of creditors
and/or the stockholders or class of stock of the Corporation, as the case may
be, to be summoned in such manner as said court directs.  If a majority in
number representing three-fourths (3/4) of the value of the creditors or class
of creditors and/or the stockholders or class of stockholders of the
Corporation, as the case may be, agree to any compromise or arrangement or to
any reorganization of the Corporation as a consequence of such compromise or
arrangement, said compromise or arrangement of said reorganization shall, if
sanctioned by the court to which said application has been made, be binding on
all the creditors or class of creditors and/or on all the stockholders or class
of stockholders, of the Corporation, as the case may be, and also on the
Corporation.


                                  ARTICLE XI.
                                  -----------

     The Board of Directors may adopt a resolution proposing to amend, alter,
change or repeal any provision contained in this Certificate of Incorporation,
in the manner now or hereafter prescribed by statute.


                                 ARTICLE XII.
                                 ------------

     A.   Indemnification of Officers and Directors.
          -----------------------------------------

     The Corporation shall:

          1.  indemnify, to the fullest extent permitted by the DGCL, any
     present or former director of the Corporation, and may indemnify any
     present or former officer, employee or agent of the Corporation selected
     by, and to the extent determined by, the Board of Directors for
     indemnification, such selection to be evidenced by an indemnification
     agreement, who was or is a party or is threatened to be made a party to any
     threatened, pending or completed action, suit or proceeding, whether civil,
     criminal, administrative or investigative (other than an action by, or in
     the right of, the Corporation) by reason of the fact that such person is or
     was a director, officer, employee or agent of the Corporation, or is or was
     serving at the request of the Corporation as a director, officer, employee
     or agent of another corporation, partnership, joint venture, trust or other

                                      -7-
<PAGE>

     enterprise, against expenses (including attorneys' fees), judgments, fines
     and amounts paid in settlement actually and reasonably incurred by such
     person in connection with such action, suit or proceeding if such person
     acted in good faith and in a manner such person reasonably believed to be
     in or not opposed to the best interests of the Corporation and, with
     respect to any criminal action or proceeding, had no reasonable cause to
     believe such person's conduct was unlawful.  The termination of any action,
     suit or proceeding by judgment, order, settlement or conviction, or upon a
     plea of nolo contendere or its equivalent, shall not, of itself, create a
     presumption that the person did not act in good faith and in a manner which
     such person reasonably believed to be in, or not opposed to, the best
     interests of the Corporation and, with respect to any criminal action or
     proceeding, had reasonable cause to believe that such person's conduct was
     unlawful; and

          2.  indemnify any present or former director of the Corporation, and
     may indemnify any present or former officer, employee or agent of the
     Corporation selected by, and to the extent determined by, the Board of
     Directors for indemnification, such selection to be evidenced by an
     indemnification agreement, who was or is a party or is threatened to be
     made a party to any threatened, pending or completed action or suit by, or
     in the right of, the Corporation to procure a judgment in its favor by
     reason of the fact that such person is or was a director, officer, employee
     or agent of the Corporation, or is or was serving at the request of the
     Corporation as a director, officer, employee or agent of another
     corporation, partnership, joint venture, trust or other enterprise, against
     expenses (including attorneys' fees) actually and reasonably incurred by
     such person in connection with the defense or settlement of such action or
     suit if such person acted in good faith and in a manner such person
     reasonably believed to be in, or not opposed to, the best interests of the
     Corporation and except that no indemnification shall be made in respect of
     any claim, issue or matter as to which such person shall have been adjudged
     to be liable to the Corporation, unless and only to the extent that the
     Court of Chancery or the court in which such action or suit was brought
     shall determine upon application that, despite the adjudication of
     liability but in view of all the circumstances of the case, such person is
     fairly and reasonably entitled to indemnity for such expenses which the
     Court of Chancery or such other court shall deem proper; and

          3.  indemnify any present or former director or officer, and may
     indemnify any present or former employee or agent of the Corporation
     selected by, and to the extent determined by, the Board of Directors for
     indemnification, such selection to be evidenced by an indemnification
     agreement, against expenses (including attorneys' fees) actually and
     reasonably incurred by such person in connection therewith, to the extent
     that such person has been successful on the merits or otherwise in defense
     of any action, suit or proceeding referred to in Article XII.A.1. and 2.,
     or in defense of any claim, issue or matter therein; and

          4.  pay expenses incurred by a director, or an officer who is entitled
     to indemnification hereunder, in defending a civil or criminal action, suit
     or proceeding in

                                      -8-
<PAGE>

     advance of the final disposition of such action, suit or proceeding upon
     receipt of an undertaking by or on behalf of such director or officer to
     repay such amount if it shall ultimately be determined that such director
     or officer is not entitled to be indemnified by the Corporation as
     authorized in this Article XII; and

          5.  notwithstanding the foregoing provisions and except as required by
     the DGCL, the Corporation shall not be obligated to indemnify or pay
     expenses incurred by any person with respect to any threatened, pending, or
     completed claims, suits or actions, whether civil, criminal,
     administrative, investigative or otherwise ("Proceedings"), initiated or
     brought voluntarily by such person and not by way of defense (other than
     Proceedings brought to establish or enforce a right to indemnification
     under the provisions of this Article XII, unless a court of competent
     jurisdiction determines that each of the material assertions made by such
     person in such Proceedings were not made in good faith or were frivolous).
     The Corporation shall not be obligated to indemnify such person for any
     amount paid in settlement of a Proceeding covered hereby without the prior
     written consent of the Corporation to such settlement; and

          6.  not deem the indemnification and advancement of expenses provided
     by, or granted pursuant to, the other subsections of this Article XII as
     exclusive of any other rights to which those seeking indemnification or
     advancement of expenses may be entitled under any By-law, agreement or vote
     of stockholders or disinterested directors, or otherwise, both as to action
     in such director's or officer's official capacity and as to action in
     another capacity while holding such office; and

          7.  have the right, authority and power to purchase and maintain
     insurance on behalf of any person who is or was a director, officer,
     employee or agent of the Corporation, or is or was serving at the request
     of the Corporation as a director, officer, employee or agent of another
     corporation, partnership, joint venture, trust or other enterprise against
     any liability asserted against such person and incurred by such person in
     any such capacity, or arising out of such person's status as such, whether
     or not the Corporation would have the power to indemnify such person
     against such liability under the provisions of this Article XII; and

          8.  deem the provisions of this Article XII to be a contract between
     the Corporation and each director, or appropriately designated officer,
     employee or agent, who serves in such capacity at any time while this
     Article XII is in effect, and any repeal or modification of this Article
     XII shall not affect any rights or obligations then existing with respect
     to any state of facts then or theretofore existing or any action, suit or
     proceeding theretofore or thereafter brought or threatened based in whole
     or in part upon such state of facts; provided, however, that the provisions
     of this Article XII shall not be deemed to be a contract between the
     Corporation and any directors, officers, employees or agents of any other
     corporation (the "Second Corporation") which shall merge into or
     consolidate with the Corporation where the Corporation shall be the
     surviving or resulting

                                      -9-
<PAGE>

     corporation, and any such directors, officers, employees or agents of the
     Second Corporation shall be indemnified to the extent required under the
     DGCL only at the discretion of the Board of Directors; and

          9.  continue the indemnification and advancement of expenses provided
     by, or granted pursuant to, this Article XII, unless otherwise provided
     when authorized or ratified, as to a person who has ceased to be a
     director, officer, employee or agent of the Corporation, and the
     indemnification and advancement of expenses provided by, or granted
     pursuant to, this Article XII shall inure to the benefit of the heirs,
     executors and administrators of such a person.

     B.   Elimination of Certain Liability of Directors.
          ---------------------------------------------

     No director of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the DGCL, as the same exists or
hereafter may be amended, or (iv) for any transaction from which the director
derived an improper personal benefit.  If the DGCL is amended to authorize the
further elimination or limitation of liability of directors, then the liability
of a director of the Corporation, in addition to the limitation on personal
liability provided herein, shall be limited to the fullest extent permitted by
the amended DGCL.  Any repeal or modification of this Article XII by the
stockholders of the Corporation shall be prospective only and shall not
adversely affect any limitation on the personal liability of a director of the
Corporation existing at the time of such repeal or modification.

                                      -10-
<PAGE>

     IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Incorporation to be signed by its President on November 16, 1999.

                                   WEB STREET, INC.


                                   By:  /s/ JOSEPH J. FOX
                                        -----------------
                                        Joseph J. Fox
                                        Co-Chairman and Chief Executive Officer

                                      -11-