On Thursday, Apr. 8, Robinhood announced a staggering surge in the number of its customers who engage in cryptocurrency trading. The financial services company which was founded on Apr. 18, 2013, has recorded that 9.5 million people have used the platform during the first quarter of this year.
The said number shoots up to a stupendous 458% increase in users, which only accounts for 1.7 million in 2020's Q4.
How Robinhood Sudden Became Popular in Crypto Trading
The Menlo Park-headquartered discount brokerage wrote in its blog post on Friday, Apr. 9 that it has observed the escalating trend in the number of its users who engage in crypto trading. Over the past three months, Robinhood's market cap has skyrocketed to more than $2 trillion, a double increase during that time.
Furthermore, the company founders also ensure that the platform users should be free to use all of its services. In this regard, Robinhood wants to align its mission of introducing an "open and decentralized" financial system globally to expand its trading.
Most likely, the growth that Robinhood experienced could impact some of the trading markets, as noted by Decrypt, a popular platform that features Bitcoin, Ethereum, and other cryptocurrencies.
However, it was also reported that there could be a potential contributor that Robinhood missed out to highlight.
Robinhood's Move to Halt Trading Operations
Earlier this year, a crypto subReddit revealed that the stock traders joined the r/WallStreetBets intending to squeeze the price of stocks from prominent companies including Blackberry, AMC, and GameStop. Later, Robinhood learned about this news and it temporarily stopped stock trading in these above-mentioned firms.
This drove the traders to explore other options and they discovered new cryptocurrencies like Dogecoin, which was popularized by Tesla CEO Elon Musk. Moreover, its value suddenly went upward after Musk sensationalized through his tweets.
However, Musk's tweet in late February cost him a $15 billion loss which is said to impact the value of Bitcoin and Ethereum.
Robinhood also imposed restrictions in stock trading by preventing its users from buying stocks from GameStop and other similar companies.
At the time, customers called it "market manipulation." In Google reviews, Robinhood only averages 1.0 since several customers filed numerous lawsuits against the company. Despite the issue, the company still managed to recover and later rose to the cryptocurrency competition.
In late January, Musk blasted Robinhood and even called its move 'BS.' Moreover, the SpaceX founder called out the platform market due to its "unfair" trading policies which prevent the investors from purchasing stocks.
Users rated Robinhood as "failed" in terms of service after the controversial tweet from Musk. At the time, its competitors were protesting to enable trading again for their users.
As a response to the crowd uproar on the internet, Robinhood promised to launch an update for $AMC and $GME traders to use the platform once again after the fiasco that happened.
Related Article: Reddit WallStreetBets Members Launches Crowdfunding to Buy Super Bowl Ad Space, Mess With Robinhood
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Written by Joen Coronel
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