Robinhood has announced that it giving up on its plans to become a federally insured bank.
The stock-trading startup is voluntarily pulling its bank charter application with the Office of the Comptroller of the Currency, which was submitted earlier this year.
“Robinhood will continue to focus on increasing participation in the financial system and challenging the industry to better serve everyone,” a spokesperson told CNBC. “We appreciate the efforts and collaboration of all the parties we worked with throughout this process.”
Earlier this year, Robinhood announced a $323 million Series E financing round, bringing the company’s valuation to $7.6 billion.
“We’ll use the funding to keep pursuing our mission of democratizing finance for all,” the company wrote in a blog post.
The funding round was led by DST Global, with participation from investors including Ribbit Capital, NEA, Sequoia and Thrive Capital. Robinhood has raised more than $860 million in venture capital funding to date.
Robinhood’s co-CEOs Baiju Bhatt and Vlad Tenev have reportedly said an initial public offering is the company’s future, but that the focus, for the time being, is on disrupting other areas of finance.
And last month, the company relaunched a checking feature called Cash Management after it was previously shelved due to regulatory issues. The feature will enable customers to earn 2.05 percent APY on any money in the account — and they will be able to spend it with a distinctive Mastercard debit card.
“If you have $5,000 in your account while you’re thinking about what to invest in, you’d have an extra $105 at the end of the year,” Bhatt said at the time.
Robinhood has been enjoying fast-paced growth thanks in large part to the fact that its stock trading app is free. In 2018 its user base jumped from 4 million during the summer to 6 million by late 2018.