Robinhood Markets Inc. HOOD reported a doubling of cryptocurrency trading volume in the third quarter.
What Happened: The company released a financial report after the closing bell on Wednesday, revealing that notional trading volume in cryptocurrencies was $14.4 billion, up 112% from last year.
Chief Financial Officer Jason Wernick said on an earnings call that notional value is expected to exceed the $5 billion mark in October alone, exceeding the monthly average for the third quarter.
Cryptocurrency-related revenue rose 165% year-over-year to $61 million due to a surge in trading volume.
Total revenue for the quarter was $637 million, missing analysts’ consensus estimates of $650.67 million.
Robinhood also reported a notable increase in crypto rebates. Rebates rose to 48 basis points in October, up from an average of 44 basis points in the third quarter and 35 basis points at the beginning of the year.
Robinhood Crypto, the company’s cryptocurrency division, allows users to trade popular coins such as Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH), and Dogecoin (CRYPTO: DOGE).
SEE ALSO: Why clearer regulations will ‘unleash’ Wall Street’s move towards digital assets
Why it matters: This surge in cryptocurrency trading volume and rebates comes in the wake of Robinhood’s recent efforts to expand its trading services.
Earlier this week, Robinhood began contracting presidential election events through its subsidiary Robinhood Derivatives, Inc. (RHD). These contracts allow users to trade based on predictions of the outcome of the 2024 presidential election.
Initially, these contracts were offered to some customers who met certain criteria, such as U.S. citizenship, but CEO Vlad Tenev said on a conference call that the products are 100% It has been confirmed that it has been rolled out to customers.
CEO Vlad Tenev said the company aims to win in the “active trader market” with the product launch.
Price Action: Robinhood shares plunged 12.4% in after-hours trading after closing 0.64% higher at $28.21 during regular trading on Tuesday.
Image via Shutterstock
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