Robinhood Plans Crypto Trading Expansion in Europe

In its third-quarter earnings call on Tuesday (Nov. 7), cryptocurrency investment platform Robinhood said it would be expanding its crypto trading offerings.

The company plans to launch crypto trading in the European Union (EU) following its successful U.K. launch “in the coming weeks.” This expansion into international markets is part of Robinhood’s strategy to gain market share and provide its industry-leading products to a wider audience.

The company said it saw a 55% decrease in crypto trading revenues in the third quarter ending Sept. 30, compared to the previous year. This decline in revenues is significant, considering the increasing popularity of cryptocurrencies and the growing interest in crypto trading among investors.

Despite the decrease in crypto trading revenues, Robinhood’s total net revenues for the third quarter of 2023 increased by 29% year over year (YoY) to $467 million. This growth in net revenues can be attributed to other sources, such as net interest revenues, which saw an increase of 96% YoY to $251 million. The growth in net interest revenues was driven by the expansion of interest-earning assets and higher short-term interest rates.

However, transaction-based revenues, including revenues from options, equities and cryptocurrencies, decreased by 11% YoY to $185 million. Within this category, cryptocurrencies specifically saw a 55% decrease in revenues, totaling $23 million for the quarter. This decline in crypto trading revenues is a factor contributing to the overall decrease in transaction-based revenues.

In addition to crypto trading, Robinhood offers a range of other products and services, including equities trading and retirement accounts. The platform has seen growth in its net cumulative funded accounts, which grew by 360,000 YoY to 23.3 million. This indicates a continued interest and trust from investors in Robinhood’s offerings.

Robinhood’s third-quarter results also revealed a net loss of $85 million, which included a per-share impact of negative $0.11 from a regulatory accrual of $104 million. However, the company’s adjusted earnings increased by 191% YoY to $137 million, showcasing its ability to generate positive cash flow.