Robinhood share prices tanked as its third-quarter financial results showed a drop from $233 million to $51 million in crypto revenue. Overall, there has been growth for the firm, as it plans more crypto products.
Trading app Robinhood has published its third-quarter financial results for 2021, with some noticeable drops in business performance. Among these changes is a drop in revenue to $51 million from $233 million during Q2 2021, which represents a significant reduction for the popular trading platform. The shares of the company tanked sharply as it missed revenue estimates.
HOOD Price: TradingView
Total net revenue increased by 35% to $365 million, compared to $270 million during the same quarter in 2021. Monthly active users increased substantially by 76% to 18.9 million users, up from 10.7 million year-over-year. The amount of assets under custody also more than doubled to $95 billion from $44 billion during Q3 2020.
The company specifically highlights the decline of crypto activity in the platform, which led to,
Considerably fewer new funded accounts, a slight decline in Net Cumulative Funded Accounts, and lower revenue in the third quarter of 2021 compared with the second quarter of 2021.
However, it does not seem to faze the company’s management, with CEO and co-founder Vlad Tenev saying that “Robinhood is becoming the most trusted and intuitive platform for retail and crypto investors.” He also notes that over one million people have joined the platform’s crypto wallets waitlist so far.
Among the improvements to the crypto products on the platform include the aforementioned crypto wallet waitlist, which it states is its most heavily requested product. The feature is intended to make crypto investment more accessible, with multifactor authentication an important part of it. Robinhood also launched a crypto recurring investments product that automatically buys commission-free crypto, allowing for the dollar-cost averaging of investments.
Robinhood has proven popular among young investors for its sleek user experience, but a series of incidents over the past year has dealt some strong blows to the company’s reputation. The most significant of these was the GameStop incident, for which the platform’s handling was roundly criticized.
The firm also received some tough scrutiny from regulators, with non-profit brokerage firm regulator FINRA hitting it with a $70 million fine. Meanwhile, New York regulators aim to impose a $10 million fine for cybersecurity and AML violations.
All of this occurred not long before Robinhood launched its highly anticipated IPO in August 2021. While the company will no doubt see growth in its business, it will have to be more cautious as a public company. To this end, it hired a former Grayscale compliance chief to help with upcoming regulation.
The post Robinhood Crypto Revenue Drops to $51M in Q3 from $233M in Q2 appeared first on BeInCrypto.
Original Source: Be In Crypto Robinhood Crypto Revenue Drops to M in Q3 from 3M in Q2