Inventory-trading app Robinhood is diving deeper into the cryptocurrency realm with the acquisition of crypto change 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 bizarre shoppers to put money into a few of the world’s largest publicly-traded firms, however it has been transferring additional into crypto territory over time. The corporate has added assist for most of the hottest cryptocurrencies, together with Bitcoin, although it restricted a few of the crypto it helps final yr as a result of regulatory scrutiny within the U.S.
Extra crypto and international enlargement
In the present day’s deal not solely indicators California-based Robinhood’s continued push into crypto, but additionally its worldwide enlargement efforts. The corporate 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 afterwards.
Based 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 referred to as NXMH in 2018 and final yr, Ripple purchased a stake, too.
Robinhood went public in mid-2021, and as with many companies that fared effectively in the course of the pandemic, the corporate noticed its preliminary good fortunes crumble because the world (and investor sentiment) returned to normality. The corporate’s IPO valuation of $32 billion surged to greater than $40 billion at one level, earlier than steadily declining effectively beneath the $10 billion mark for a lot of the previous two years.
Nonetheless, the buying and selling app has seen its valuation greater than double up to now yr to $19 billion, buoyed by report earnings. In its Q1 2024 report in Might, 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% enhance in cryptocurrency earnings, which got here to $126 million.
With Bitstamp beneath its wing, Robinhood says it is going to be higher positioned to focus on retail and institutional crypto buyers 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 serious step in rising our crypto enterprise,” Robinhood’s crypto normal supervisor, Johann Kerbrat, mentioned in a press release. “The Bitstamp group has established one of many strongest reputations throughout retail and institutional crypto buyers. By way of this strategic mixture, we’re higher positioned to increase our footprint outdoors of the U.S. and welcome institutional clients to Robinhood.”
