Markets
Robinhood Buys Bitstamp to Grow Crypto and International Trading
Key takeaways
- Online trading platform Robinhood has agreed to buy European cryptocurrency exchange Bitstamp for around $200 million.
- The deal will help grow Robinhood’s cryptocurrency business, which has been growing in recent quarters, particularly in a number of international markets where Bitstamp operates.
- The expansion comes as Robinhood’s existing crypto business has drawn attention from regulators, with the SEC sending the company a Wells Notice last month, indicating potential enforcement actions.
Robinhood Markets online trading platform (HOOD) has agreed to buy European cryptocurrency exchange Bitstamp for about $200 million, in a deal that will expand Robinhood’s international and cryptocurrency businesses, according to a statement released Thursday.
“Acquiring a global exchange will significantly accelerate Robinhood Crypto’s expansion around the world,” Robinhood said, noting that Bitstamp has more than 50 active licenses and registrations across the world and will attract customers from across Europe and Asia as well as the United States on its platform.
Robinhood’s Growing Crypto and International Trading
The deal will help increase Robinhood’s presence outside the United States, as well as its Robinhood Crypto activity. The company also recently decided to expand with products like credit cardsand by offering its UK app.
The crypto industry has increased Robinhood’s revenue In recent quarters, the company reported last month that revenue from its crypto business more than tripled in the first quarter from a year earlier, to $126 million.
“The acquisition of Bitstamp is a major milestone in the growth of our crypto business,” said Johann Kerbrat, chief executive officer of Robinhood Crypto, adding that “Bitstamp’s highly trusted and long-standing global exchange has demonstrated resilience through market cycles.
However, Robinhood’s crypto activity has attracted the attention of regulators, as Robinhood said it received A Well Notice of Securities and Exchange Commission (SEC) last month, indicating that the regulator had concluded an investigation that could lead to enforcement action.
Robinhood said it expects its acquisition of Bitstamp to be completed by the first half of next year, pending regulatory approval.
Shares of Robinhood jumped more than 5% to $22.70 as of 10:40 a.m. ET Thursday following the news, contributing to their 78% year-to-date gain.