Markets
Robinhood Expands Crypto Offering With Bitstamp Deal
Robinhood Markets is about to acquire a cryptocurrency exchange Bit stamp for $200 million.
“Acquiring a global exchange will significantly accelerate Robinhood Crypto’s expansion around the world,” the company said in a statement. Press release Thursday (June 6). “Bitstamp holds over 50 active licenses and registrations globally and will attract customers from the EU, UK, US and Asia to Robinhood.”
According to the release, the acquisition of Luxembourg-based Bitstamp marks Robinhood’s first institutional business, giving it access to Bitstamp’s other institutional offerings such as the Bitstamp-as-a-service white-label solution, institutional lending and staking.
“The acquisition of Bitstamp is a major step in the growth of our crypto business. Bitstamp’s long-standing and highly trusted global exchange has demonstrated resilience throughout market cycles,” said Johann Kerbrat, CEO of Robinhood Crypto. “By seamlessly combining customer experience with security across geographies, the Bitstamp team has built one of the strongest reputations among retail and institutional crypto investors.”
Added Bitstamp CEO JB Graftieaux: “As the world’s oldest cryptocurrency exchange, Bitstamp is known as one of the most trusted and transparent cryptocurrency platforms in the world. Integrating Bitstamp’s platform and expertise into the Robinhood ecosystem will provide users with an enhanced trading experience with a continued commitment to compliance, security and customer focus.
Last month, Robinhood reported earnings that exceeded expectations, an increase in profits attributed in part to the company’s thriving crypto business. This activity was in turn boosted by the approval of the first Bitcoin spot exchange-traded fund in the United States earlier this year.
At the same time, Robinhood faces challenges, such as the recent Well Notice from the Securities and Exchange Commission (SEC), a sign of impending enforcement action against the company, which raises concerns about the future of Robinhood’s crypto trading arm.
The company has asserted its strong belief that crypto assets listed on its platform are not securities and that it would fight the SEC’s enforcement efforts.
“After years of good faith attempts to work with the SEC to clarify the regulations, including our well-known attempt to ‘get in and register,’ we are disappointed that the agency has decided to issue a Wells Notice related to our crypto operations in the United States. Dan Gallagherresponsible for legal, compliance and general corporate affairs, said in a blog post.