During Robinhood’s fourth quarter (Q4) 2023 earnings call on Feb. 13, the company’s Chief Financial Officer, Jason Warnick, revealed that the majority of crypto trading on the platform remains in spot Bitcoin, with only 5% of users engaging in trading through Bitcoin ETFs.
Warnick stated that 95% of Robinhood’s users opt for direct spot Bitcoin trading, indicating that spot trading remains the preferred method among traders. He emphasized that the introduction of Bitcoin ETFs did not significantly cannibalize spot trading but rather served as an additional option for some traders.
While some traders shifted from spot trading to ETFs, Warnick noted that this was more of an exception. Overall, Robinhood views the availability of Bitcoin ETFs as an additive feature rather than a replacement for spot trading.
Warnick mentioned that some Robinhood traders incorporated Bitcoin ETFs into their retirement accounts, contributing to the uptake of these ETFs on the platform.
The introduction of spot Bitcoin ETFs has been successful, with over $10 billion in assets under management since their launch. This development coincided with a 6.5% increase in Bitcoin’s price, briefly surpassing $50,000 on Feb. 12, marking its highest point in over two years.
Robinhood’s revenues for Q4 and full-year 2023 exceeded expectations, primarily driven by increased crypto transaction revenue. Total annual revenues reached $1.87 billion, up 37% year-on-year, with Q4 revenue at $471 million, up 24% from the previous year.
Crypto trading revenue in Q4 reached $43 million, up 10% year-over-year, contributing significantly to Robinhood’s total revenues.
Robinhood shares experienced fluctuations, closing down approximately 1.5% on Feb. 13 but surging over 10.5% in after-hours trading to over $13. However, the year-to-date share price struggled, falling over 4%, contrasting with the gain posted by the S&P 500. Robinhood’s shares are down over 78% from their all-time high on Aug. 6, 2021.
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