Robinhood Makes Splash in EU with Crypto Trading Launch

Robinhood to launch crypto trading in EU amid revenue drop

Robinhood, the popular online stock brokerage, has announced its plans to launch crypto trading in the EU in the coming weeks. This is a major step for the company, which has been facing regulatory challenges and declining revenue from its crypto business in the US.

According to its third-quarter earnings report, Robinhood's crypto-related revenue fell 55% year-over-year, from $51 million in 2022 to $23 million in 2023. The number of crypto assets held on behalf of customers also decreased 11% from the previous quarter, from $11.5 billion to $10.2 billion. The company attributed the decline to the lower trading volumes and prices of cryptocurrencies, especially dogecoin, which accounted for 62% of its crypto revenue in the second quarter.

However, the company is not giving up on its crypto ambitions and is looking to expand its crypto trading services to new markets. Robinhood said that it will soon launch brokerage operations in the UK and that it will also introduce crypto trading in the EU following its UK launch. The company did not specify which countries or cryptocurrencies will be supported, but it currently offers trading for 15 different cryptocurrencies in the US, including bitcoin, ether, and Dogecoin.

Robinhood's expansion into Europe comes amid growing demand and interest for crypto trading in the region. According to a recent report by Chainalysis, Europe is the second-largest crypto market in the world, after North America, with $1.2 trillion worth of crypto transactions in the first half of 2023. The report also found that Europe has the highest adoption rate of decentralized finance (DeFi) and non-fungible tokens (NFTs), which are two of the most innovative and popular applications of crypto technology.

Robinhood's move to enter the European crypto market could also give it a competitive edge over its rivals, such as Coinbase, Binance, and eToro, which already operate in the region. Robinhood's main selling point is its zero-commission trading model, which could attract more users and investors who are looking for low-cost and convenient ways to access the crypto space. Robinhood also claims to offer a user-friendly and intuitive platform, which could appeal to beginners and casual traders who are interested in crypto.

However, Robinhood's expansion into Europe is not without challenges and risks. The company will have to comply with the different and evolving regulatory frameworks and requirements of each country and jurisdiction, which could pose legal and operational difficulties and costs. The company will also have to deal with the competition and reputation issues that it faces in the US, where it has been accused of misleading and harming its customers, as well as facing lawsuits and investigations from regulators and authorities.