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Robinhood updates
Signal as much as myFT Each day Digest to be the primary to learn about Robinhood information.
Robinhood stated on Wednesday it might start providing crypto wallets on its platform, placing the fast-growing retail inventory brokerage in direct competitors with extra established digital foreign money venues akin to Coinbase.
The wallets will enable Robinhood clients to immediately personal and switch bitcoin and different cryptocurrencies to be able to pay for items and companies, moderately than merely commerce crypto as is at present allowed.
Shares in Robinhood rose 11 per cent on Wednesday, lifting its market capitalisation to $40bn.
Robinhood stated it anticipated to start testing the wallets with a small group of shoppers in October earlier than increasing the providing to its greater than 32m registered customers. Virtually 300,000 clients signed up for the pockets wait-list inside hours of the announcement, in line with info posted on the Robinhood app.
Cryptocurrency buying and selling accounted for $233m of Robinhood’s income within the second quarter of this yr, up from $5m in the identical quarter in 2020.
About 60 per cent of funded accounts on the platform traded cryptocurrency of some form in the course of the second quarter, the dealer stated. Sixty-two per cent of cryptocurrency transaction income throughout that interval was derived from buying and selling in dogecoin, which was initially conceived as a joke and was championed by Elon Musk.
The brokerage’s cryptocurrency belongings beneath custody hit $22.7bn on the finish of the interval, 29 instances larger than the earlier yr.
Robinhood informed retail investors in a latest presentation that cryptocurrency buying and selling can be an essential providing in its worldwide enlargement. The dealer additionally plans to permit customers to make automated recurring investments in cryptocurrencies.
Financial regulators are sharpening their gaze on the burgeoning cryptocurrency buying and selling trade. Protections stay extremely limited for customers harmed whereas buying and selling crypto.
Robinhood has come beneath scrutiny from regulators, together with for a streamlined and “gamified” person expertise that makes use of animations to stimulate buying and selling behaviour and makes it potential to purchase and promote shares and cryptocurrencies inside seconds.
The pockets launch was introduced to Robinhood clients with a push notification that included a “high-five” emoji. The brokerage additionally tweeted a hyperlink to a video clip from the sitcom Seinfeld with Robinhood co-founder Vlad Tenev’s face superimposed on the face of the character George Costanza, the place Costanza pulls an overflowing leather-based pockets out of his again pocket.
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