Robinhood’s Crypto Activity Drops 78%, Stock Tanks Below IPO
28 Octobre 2021 - 2:22AM
NEWSBTC
Robinhood had a net loss of $1.32 billion this past quarter,
recording a plunge of 78% in revenue from crypto transactions from
2Q. Their shares dropped 12% to $34.80 at 9:46 a.m. in New York,
$38 below the IPO price in late July, Bloomberg reported. Analysts
had estimated Robinhood Markets Inc. would have a total revenue of
$423.9 million during an earlier Bloomberg survey, but the numbers
fell short hitting only $364.9 million. Vlad Tenev, Robinhood’s
Chief Executive Officer, had predicted that the trading activity
would tumble in the third quarter of 2021 and fewer accounts would
open. As he stated during the Q3 Earnings Call, the tumbling
numbers do not worry them since they have different short-term
goals. The fourth quarter might be falling short as their
anticipation for Q4 is that “total revenue will be less than $325
million and full-year revenue will be less than $1.8 billion. At
the top end, this implies full-year revenue growth of 85 percent.”,
said Jason Warnick, Chief Financial Officer. Warnick also reminded
that they typically show a “seasonality curve that shows higher
growth in the first quarter of the year versus the last three
quarters.”, and further explained their Q3 focus on building a
team: We continue to make progress building our teams with
increases primarily in engineering, customer service, and our
regulatory, and compliance teams. In the quarter, we added 580 new
full-time employees across the company, growing 21 percent
sequentially versus Q2. Warnick added that they are not worried
about the near-term profitability, rather they feel safe about
being “a profitable company over the long term.” Robinhood’s Crypto
Activity Drops-Off In Robinhood’s report they show a big drop-off
on their monthly active users (MAU) from 21.3 million in the second
quarter to 18.9 million in this third quarter. Their crypto
activity tumbled as well, as they had significantly fewer new
funded accounts. Many thought Robinhood would improve the way to
invest in the crypto market. However, many wonder if they can meet
with many of their clients interests, such as integrating new
digital coins. Related Reading | Strategist: Next Wave of
Bitcoin Investors Likely to Come from Robinhood Crypto activity and
revenue plays a big role in Robinhood’s platform. Ever since they
announced their intent to offer a crypto wallet, a waitlist of 1
million clients surged. On the potential growth that this project
might bring, Tenev commented: We actually believe that by rolling
out wallets, we will go a long way toward addressing the primary
pain point that customers feel right now. Regulatory Requirements
Vs. Crypto Platforms Tenev stated during the Earnings Call that
“the regulatory landscape is increasingly uncertain.” As they want
to enhance their involvement in the crypto space, they also intend
to watch over their platform and keep it safe by “introducing
products that comply with legal and regulatory requirements.” He
explained that Robinhood is carefully looking into new virtual
currencies, but they mantain the focus on meeting regulatory
guidelines since they do not want another run-in Related Reading
| Robinhood Fined $70M For Causing “Significant Harm” To
Customers In a recent interview with Bloomberg, Blockchain Capital
General Partner Spencer Bogart reacted to Robinhood’s tumbling
numbers and suggested this drop-off aligns with the frustration
that the historically unfriendly regulations from the U.S create
for crypto platforms. Bogart explains that “Historically, the U.S.
has been so unfriendly to innovation in the crypto space that most
platforms are forced to ban Americans.” According to his opinion,
regulations have only worked against the American people’s freedom
rather than being implemented in their favor. For a country that is
founded on the principles of freedom, growth, and innovation, to
see the U.S. on a shortlist that these merging crypto platforms
cannot service, alongside Syria, Sudan and North Korea, it is not
just a disgrace, it is a disservice to the American people who
should be able to access this technology. He clarifies that he is
unsure of Robinhood’s inside issues, but he understands the
landscape behind Tenev’s comments about the regulatory situation
“where there really isn’t much clarity”. However, he remains
positive as he sees “the tide turning” for crypto. Robinhood does
not sound worried about the Q4 result and they are aiming to play
the profitability slow and steady. Warnick said they are investing
in crypto and looking forward to diversifying their product
selection.
Bitcoin (COIN:BTCUSD)
Graphique Historique de l'Action
De Mar 2024 à Avr 2024
Bitcoin (COIN:BTCUSD)
Graphique Historique de l'Action
De Avr 2023 à Avr 2024