5 months ago
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Stock-trading platform Robinhood is diving deeper into the cryptocurrency realm with the acquisition of crytpo exchange Bitstamp.
Robinhood said it expects the deal to close in the first half of 2025, with the final transaction value to be in the region of $200 million.
While Robinhood is better known for its stock-trading services, allowing ordinary consumers to invest in some of the world’s largest publicly-traded companies, it has been moving further into crypto territory with support for many of the most popular cryptocurrencies including Bitcoin, though last year it restricted some of the crypto it supports due to regulatory scrutiny in the U.S.
More crypto and global expansion
Today’s announcement not only signals California-based Robinhood continued push into crypto, but also its international expansion efforts which kicked off with its U.K. launch last November starting with its core stock-trading product, followed shortly after by its crypto trading launch in the European Union (EU).
Founded out of Europe in 2011, Bitstamp is among the world’s oldest cryptocurrency exchanges, allowing companies and individuals to trade all manner of cryptocurrency. It was acquired by a Belgian investment company call NXMH in 2018, with Ripple taking a stake just last year.
Robinhood became a publicly traded entity in mid-2021, and as with many firms during the pandemic, the company saw its initial good fortunes crumble as the world returned to normality — it saw its IPO valuation of $32 billion surge to more than $40 billion at one point, before falling into a steady decline well below the $10 billion mark for much of the past two years.
However, the company has seen its valuation more than double in the past year to $19 billion, buoyed by record earnings. At its Q1 2024 report in May, Robinhood said that its monthly active users had increased 16% year-on-year to 13.7 million, while its revenues rose 40% to $618 million. Notably, the company said that its transaction-based revenue specifically had grown 59% to $329 million, which had primarily been driven by cryptocurrency income of $126 million — up 232%.
With Bitstamp under its wing, Robinhood says that it will be better positioned to target retail and institutional crypto investors across Europe, Asia, and the U.S., with Bitstamp currently holding more than 50 licenses and registrations to operate in these markets.
“The acquisition of Bitstamp is a major step in growing our crypto business,” Robinhood’s crypto general manager Johann Kerbrat said in a statement. “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.”
