The agreement will support the expansion of Bitstamp's operations in several international regions, particularly in the cryptocurrency business that Robinhood has been growing dramatically in recent quarters.
According to an announcement on Thursday, online trading platform Robinhood Markets (HOOD) has reached an agreement to purchase Bitstamp, a cryptocurrency exchange in Europe, for around $200 million. This acquisition would grow Robinhood's cryptocurrency and worldwide business.
"Getting a global exchange will greatly speed up Robinhood Crypto's international expansion," the company stated. It cited Bitstamp's more than 50 active licenses and registrations worldwide, which will attract users from Europe and Asia in addition to the United States.
1.
Growing Crypto and Global Business for Robinhood
The agreement will support the expansion of Robinhood's business ventures, including Robinhood Crypto, outside of the United States. The business has also made recent moves to grow by launching its app in the UK and supplying goods like credit cards.
The company reported last month that income from its crypto business more than tripled in the first quarter from a year earlier to $126 million. This increase in sales has helped Robinhood's profits in recent quarters.
"Bitstamp's highly reputable and long-standing global exchange has demonstrated resilience through market cycles," Johann Kerbrat, general manager of Robinhood Crypto, said, adding that "the acquisition of Bitstamp is a major step in growing our crypto business."
However, regulators have expressed concern about Robinhood's cryptocurrency operations.
Growing Crypto and Global Business for Robinhood
The agreement will support the expansion of Robinhood's business ventures, including Robinhood Crypto, outside of the United States. The business has also made recent moves to grow by launching its app in the UK and supplying goods like credit cards.
The company reported last month that income from its crypto business more than tripled in the first quarter from a year earlier to $126 million. This increase in sales has helped Robinhood's profits in recent quarters.
"Bitstamp's highly reputable and long-standing global exchange has demonstrated resilience through market cycles," Johann Kerbrat, general manager of Robinhood Crypto, said, adding that "the acquisition of Bitstamp is a major step in growing our crypto business."
However, regulators have expressed concern about Robinhood's cryptocurrency operations.
as Robinhood reported that the Securities and Exchange Commission (SEC) sent it a Wells Notice last month, suggesting that the agency has finished an investigation that might result in enforcement actions.
Subject to regulatory approval, Robinhood stated that it anticipates closing the acquisition of Bitstamp during the first half of next year.
Following the news, Robinhood shares increased by more than 5% to $22.70 as of 10:40 a.m. ET on Thursday, adding to their 78% rise since the year's beginning.
Do you have a news tip for the reporters at Investopedia?
Compete Without Risk Using $100,000 in Virtual Money
Use our FREE Stock Simulator to test your trading abilities. Trade your way to the top while competing against hundreds of other Investopedia traders!
Subject to regulatory approval, Robinhood stated that it anticipates closing the acquisition of Bitstamp during the first half of next year.
Following the news, Robinhood shares increased by more than 5% to $22.70 as of 10:40 a.m. ET on Thursday, adding to their 78% rise since the year's beginning.
Do you have a news tip for the reporters at Investopedia?
Compete Without Risk Using $100,000 in Virtual Money
Use our FREE Stock Simulator to test your trading abilities. Trade your way to the top while competing against hundreds of other Investopedia traders!
Before risking your own money, execute transactions in a virtual environment. Practice your trading techniques so that you will have the necessary experience for when the time comes to enter the real market. Take a look at our stock simulator now.