Robinhood crypto division is making a big push to become a major player in the world of cryptocurrency exchanges with 9-figure deal for Bitstamp exchange.
Trading platform Robinhood announced today (June 6) that it has agreed to buy Luxembourg-based crypto exchange Bitstamp for around $200 million. This move accelerates Robinhood’s plan to gain further exposure to the cryptocurrency industry.
We’re accelerating Robinhood Crypto’s worldwide expansion. Robinhood has officially entered into an agreement to acquire @Bitstamp, a global cryptocurrency exchange with customers across the EU, UK, US and Asia.
More details: https://t.co/wk3x02z0rU pic.twitter.com/aadKzhCxlx
— Robinhood (@RobinhoodApp) June 6, 2024
Full Steam Ahead For Robinhood In Bid To Become Major Crypto Player
For some time now, Robinhood has been seeking to expand its product offerings to become a full-spectrum financial services provider.
The acquisition of Bitstamp means Robinhood is now swimming in the same circles as industry giants such as Coinbase and Binance.
“robinhood is buying bitstamp for $200m and you’re in stables getting ready for no screen summer” pic.twitter.com/gGH8rb1zM0
— Bags (@0xbags) June 6, 2024
Bitstamp was founded in 2011 and holds 50 active licenses and registrations globally. Its spot exchange has over 85 tradable assets currently, and Robinhood is expecting this deal to strengthen the digital asset side of the company.
From its official press release, the General Manager of Robinhood Crypto, Johann Kerbat, said, “The acquisition of Bitstamp is a major step in growing our crypto business. Bitstamp’s highly trusted and long-standing global exchange has shown resilience through market cycles. By seamlessly coupling customer experience with safety across geographies, the Bitstamp team has established one of the strongest reputations across retail and institutional crypto investors”.
He added, “Through this strategic combination, we are better positioned to expand our footprint outside of the US and welcome institutional customers to Robinhood.”
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Trading Platform Keen To Stay On Right Side Of The SEC
Kerbrat also noted that the company intends to keep communicating with regulators as it moves forward. Robinhood’s crypto business was the main reason for its huge first-quarter earnings report in May.
Around the same time, it also disclosed that it had received a ‘Wells’ notice from the U.S. Securities and Exchange Commission (SEC) regarding tokens traded on its platform. The notice is issued when the regulator plans to bring enforcement action against a company.
The market regulator is pushing ahead with a major crackdown on crypto. The SEC has argued that crypto tokens should be considered securities and subject to its registration rules.
Crypto companies have argued the other way and have even accused the SEC of abusing its power.
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Robinhood’s stock has surged +69% this year after saying it plans to focus on “profitable growth.” It is currently up around +4.6% today, coming from the Bitstamp acquisition news. Analysts expect continued gains for the company for the rest of the year.
This is due to increased crypto adoption booms via ETFs, so many more retail traders are entering the market.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
