Robinhood’s Acquisition of Bitstamp Expands Its Global Reach: Architect Partners

Crypto is becoming an increasingly important part of Robinhood’s business, accounting for 20% of total revenue in the first quarter, the report said.

AccessTimeIconJun 10, 2024 at 10:18 a.m. UTC
Updated Jun 10, 2024 at 10:21 a.m. UTC
  • The Bitstamp acquisition expands Robinhood’s global reach, the report said.
  • The investment bank said the deal also increases the trading platform’s institutional exposure.
  • Architect Partners said the price paid for the acquisition was reasonable.
  • The 'Real Question' About Sam Bankman-Fried's Trial is What Happens Next: Kevin O'Leary
    The 'Real Question' About Sam Bankman-Fried's Trial is What Happens Next: Kevin O'Leary
  • How Decentralization Cultivates Community
    How Decentralization Cultivates Community
  • How Decentralized Threads Build Web3
    How Decentralized Threads Build Web3
  • Opening the World of Transactions
    Opening the World of Transactions
  • Crypto is becoming an increasingly important part of Robinhood’s (HOOD) business and, despite receiving a Wells Notice from the U.S. Securities and Exchange Commission (SEC) last month, the trading platform continues to expand its digital assets business, investment bank Architect Partners said in a Friday report.

    The expansion is evidenced by the recent agreement to buy crypto exchange Bitstamp, the bank said. Architect notes that crypto accounted for 20% of Robinhood’s total revenue in first-quarter 2024.

    “This acquisition instantly expands global reach to ensure participation regardless of U.S. actions,” the report said.

    A Wells Notice is a preliminary warning from the SEC informing a company that the regulator has enough information to bring a potential enforcement action against it. Robinhood received a Wells Notice from the SEC on May 4 due to its listing of crypto tokens that the regulator potentially views as unlicensed securities.

    The Bitstamp acquisition will also expand Robinhood’s institutional offering, which positions the trading platform as one of the “few publicly traded crypto-influenced companies that will be able to serve institutions as they come into the digital asset space,” the note said.

    Bitstamp is a “prime asset due to its long operation history and global licensing reach,” Architect said, adding that Robinhood acquired the crypto exchange at a reasonable price.

    Architect notes that the price paid by Robinhood of $200 million in cash is a significant discount to the $500 million valuation that Bitstamp received in the 2018 majority investment.

    Edited by Sheldon Reback.


    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Author placeholder image

    Will Canny is CoinDesk's finance reporter.