Stock-trading app Robinhood is diving deeper into the cryptocurrency realm with the acquisition of crypto exchange Bitstamp.
Robinhood on Thursday mentioned it expects the ultimate transaction worth to be round $200 million and the deal to shut within the first half of 2025.
Robinhood is understood for its stock-trading providers, permitting abnormal shoppers to put money into a number of the world’s largest publicly traded firms, but it surely has been transferring additional into crypto territory through the years. The firm has added assist for lots of the hottest cryptocurrencies, together with Bitcoin, although it restricted a number of the crypto it helps final 12 months attributable to regulatory scrutiny within the U.S.
More crypto and global growth
Today’s deal alerts California-based Robinhood’s continued push not solely into crypto, but in addition its worldwide growth efforts. The firm launched its core stock-trading product within the U.Ok. final November and began providing crypto buying and selling within the European Union (EU) shortly afterward.
Founded in Europe in 2011, Bitstamp is among the many world’s oldest cryptocurrency exchanges, permitting firms and people to commerce all method of cryptocurrency. It was acquired by a Belgian funding firm known as NXMH in 2018 and final 12 months, Ripple purchased a stake, too.
Robinhood went public in mid-2021, and as with many corporations that fared effectively through the pandemic, the corporate noticed its preliminary good fortunes crumble because the world (and investor sentiment) returned to normality. The firm’s IPO valuation of $32 billion surged to greater than $40 billion at one level, earlier than steadily declining effectively under the $10 billion mark for a lot of the previous two years.
However, the buying and selling app has seen its valuation greater than double prior to now 12 months to $19 billion, buoyed by document earnings. In its Q1 2024 report in May, Robinhood mentioned its month-to-month lively customers had elevated 16% year-on-year to 13.7 million, whereas its revenues rose 40% to $618 million. Notably, the corporate mentioned its transaction-based income had risen by 59% to $329 million, primarily pushed by a 232% improve in cryptocurrency earnings, which got here to $126 million.
With Bitstamp beneath its wing, Robinhood says it will likely be higher positioned to focus on retail and institutional crypto traders throughout Europe, Asia and the U.S. Bitstamp at the moment holds greater than 50 licenses and registrations to function in these markets.
“The acquisition of Bitstamp is a major step in growing our crypto business,” Robinhood’s crypto normal supervisor, Johann Kerbrat, mentioned in an announcement. “The Bitstamp team has established one of the strongest reputations across retail and institutional crypto investors. Through this strategic combination, we are better positioned to expand our footprint outside of the U.S. and welcome institutional customers to Robinhood.”