THELOGICALINDIAN - Stock allowance Robinhood launched nofee cryptocurrency trading in February 2024 and intends to accomplish cryptocurrency trading as a breakeven business
Robinhood created its commission-free banal allowance in 2024, accouterment above antagonism to absolute fee-based trading platforms. Instead of authoritative money from agency fees on banal and cryptocurrency trades, the aggregation takes its profits from absorption becoming on banknote balances, allowance lending, and its exceptional services.
When Robinhood aboriginal announced at the end of January 2018 that it would be ablution zero-fee cryptocurrency trading, reactions aural the crypto and banking communities were swift. Aural aloof four canicule of the announcement, added than one actor bodies had active up for aboriginal admission to the Robinhood Crypto app. In the canicule afterward the app’s official barrage in February, growing absorption and action sparked a flood of new barter – as abounding as 200,000 per day.
With such a massive arrival of new users acquisitive to barter cryptocurrencies, it would be appetizing for any barter to amend their action and allegation at atomic a nominal barter fee, but Robinhood is afraid to its guns.
Vlad Tenev, Robinhood architect and co-CEO told Fortune:
Tenev’s animadversion reinforces a agnate account fabricated in the company’s advertisement aback in January in which he explained some of the acumen abaft the decision:
In an adventure of Balancing the Ledger, Tenev explains that Robinhood is operating its cryptocurrency trading arm as a breakeven business. It is a move evocative of Square alms its users zero-fee Bitcoin trading through its Cash app beforehand this year. In fact, Square afresh announced that it fabricated aloof $223,000 added on Bitcoin sales than it originally paid for the bill in Q1 2018.
So why aim for breaking even? As Tenev and his co-CEO, Baiju Bhatt, explain, they appearance cryptocurrencies as an access point assimilate their belvedere for new traders. The approach is that new traders will appear to the belvedere initially for cryptocurrency trading, but again aggrandize their interests to the added added acceptable assets on which Robinhood reaps college margins.
With a accepted appraisal of about $5.6 billion, Robinhood is the additional best admired clandestine fintech aggregation in the apple with over 4 actor barter trading stocks, ETFs, and cryptocurrencies.
Speaking about the accommodation to acquaint cryptocurrency trading, Tenev explained:
Tenev believes agency fees are outdated, abnormally because the lower costs of operation of avant-garde online exchanges and brokers. Robinhood’s access is to use technology and automation to abate costs for barter and it aims to eventually attempt with Bank of America beyond all banking products.
Robinhood is planning to add added cryptocurrencies to its absolute trading of Bitcoin and Ethereum but is alert of authoritative uncertainty. It will additionally appraise new bill thoroughly.
Do you accede with Tenev? Are acceptable banking account providers ripping barter off? Let us apperceive in the comments below.
Images address of Robinhood, AdobeStock
