Robinhood, the popular stock-trading app, is making a significant move into the cryptocurrency market with the acquisition of crypto exchange Bitstamp.
On Thursday, Robinhood announced that it expects the final transaction value to be around $200 million, with the deal anticipated to close in the first half of 2025.
Known primarily for its stock-trading services, Robinhood has been progressively expanding into the crypto sector over the past few years. The company has introduced support for numerous leading cryptocurrencies, including Bitcoin, though it restricted some of its crypto offerings last year due to increased regulatory scrutiny in the U.S.
Crypto and Global Expansion
This acquisition highlights Robinhood’s continued commitment to both cryptocurrency and international growth. The California-based company launched its stock-trading platform in the U.K. last November and began offering crypto trading in the European Union shortly thereafter.
Founded in Europe in 2011, Bitstamp is one of the oldest cryptocurrency exchanges, providing a platform for both companies and individuals to trade various cryptocurrencies. In 2018, Bitstamp was acquired by the Belgian investment firm NXMH, and last year, Ripple also purchased a stake in the company.
Robinhood went public in mid-2021 and experienced a rapid rise in value during the pandemic. However, as global conditions normalized, the company’s fortunes waned. Robinhood’s IPO valuation of $32 billion briefly surged to over $40 billion before declining to below $10 billion for much of the past two years.
Despite these challenges, Robinhood’s valuation has more than doubled in the past year, reaching $19 billion, driven by record earnings. In its Q1 2024 report, Robinhood reported a 16% year-on-year increase in monthly active users to 13.7 million and a 40% rise in revenues to $618 million. Notably, the company’s transaction-based revenue grew by 59% to $329 million, largely due to a 232% increase in cryptocurrency income, which totaled $126 million.
With the acquisition of Bitstamp, Robinhood aims to strengthen its position in the crypto market and expand its reach to retail and institutional crypto investors across Europe, Asia, and the U.S. Bitstamp currently holds over 50 licenses and registrations to operate in these markets.
“The acquisition of Bitstamp is a major step in growing our crypto business,” said Johann Kerbrat, Robinhood’s crypto general manager. “The Bitstamp team has established one of the strongest reputations across retail and institutional crypto investors. Through this strategic combination, we are better positioned to expand our footprint outside of the U.S. and welcome institutional customers to Robinhood.”
