Bitcoin
Robinhood agrees to buy crypto exchange Bitstamp for $200 million
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Robinhood has agreed to buy European cryptocurrency exchange Bitstamp for $200 million, accelerating the U.S. retail broker’s expansion outside its home market and into digital assets.
The Californian group said on Thursday that the purchase of one of the world’s oldest cryptocurrency exchanges would also mark its first foray into targeting institutional investors. The company’s shares rose 5.4% in early trading, reaching their highest level since December 2021.
Robinhood Bitcoin Inc. is seeking to capitalize on a renewed wave of demand for digital assets from investors as the price of bitcoin trades near its all-time high.
In recent months, the brokerage has sought to grow its “meme stocks” app, the rise of retail trading that has catapulted the company into the mainstream with moves to credit cards.
It was at the center of the January 2021 stock trading mania that nearly overwhelmed the company, requiring an injection of capital from shareholders to shore your finances.
Its move outside the US also comes amid intense US regulatory scrutiny over the cryptography industry, following the collapse of exchange FTX in 2022 and the subsequent 25-year prison sentence for its founder Sam Bankman-Fried earlier this year.
The broker warned last month that it was waiting a Securities and Exchange Commission lawsuit over its crypto business, which offers commission-free trading in 15 cryptocurrencies in most US states.
The SEC has filed a series of lawsuits against some of the biggest companies in the market, including Coinbase and Binance, and Consensys as well. indicated is awaiting a process from the agency.
The approval of spot bitcoin exchange-traded funds earlier this year led to renewed optimism and interest in the industry, causing the price of bitcoin to reach record highs of $73,000.
“The acquisition of Bitstamp is an important step in growing our crypto business,” said Johann Kerbrat, general manager at Robinhood Crypto. “Through this strategic combination, we are better positioned to expand our presence outside the US and welcome institutional clients.”
Robinhood made 17% of its revenues based on digital token transactions last year and has stepped up its crypto plans, offering trading to customers in the EU starting in December.
Bitstamp was founded in 2011 and is headquartered in Luxembourg. It is the 16th largest cryptocurrency exchange by trading volume, according to data from CoinMarketCap, and allows retail and institutional traders to buy and sell cryptocurrencies, as well as offering cryptocurrency lending and staking.
The exchange obtained a UK registration last summer from the Financial Conduct Authority and claims to have more than 50 licenses and registrations worldwide.
Barclays Capital was Robinhood’s financial advisor, while Galaxy Digital Partners advised Bitstamp.