Robinhood's Crypto Surge: 8x Revenue Boost Puts Pressure on Coinbase

Robinhood's crypto trading division reportedly witnessed an eight-fold surge in revenues generated from digital asset transactions in the final quarter of 2024, putting pressure on Coinbase, the leading US-based crypto exchange.

According to a new Robinhood investment report, the trading app giant saw a 200% year-over-year increase in transaction-based revenues, largely driven by crypto. Total net revenues increased 115% year-over-year to $1.01 billion. Transaction-based revenues increased over 200% year-over-year to $672 million, primarily driven by cryptocurrencies revenue of $358 million, up over 700%, options revenue of $222 million, up 83%, and equities revenue of $61 million, up 144%. Net interest revenues increased 25% year-over-year to $296 million, primarily driven by growth in interest-earning assets, partially offset by a lower federal funds rate. Other revenues increased 31% year-over-year to $46 million, primarily due to increased Gold subscription revenues.

Analysts suggest that Robinhood's latest foray into crypto solidifies its position as a top rival to Coinbase. Paul Marino, Chief Revenue Officer at Themes ETFs, attributes Robinhood's success to the adoption of its platform and the preference of the next generation of traders for what Robinhood offers over competitors.

Coinbase is expected to release its own quarterly earnings report later today, which may provide further insights into the competitive landscape in the crypto trading space.