Robinhood Crypto trading volume increased by 95% in January
Robinhood’s cryptocurrency trading volume reached $3.7 billion last month, a 95% increase compared to December 2022.
In contrast to the good start to the year, the bear market of 2022 took its toll on the firm’s crypto revenues. It also laid off nearly a third of its total workforce.
Starts on the right foot
The cryptocurrency market made an impressive comeback during the first month of 2023, with most assets increasing their valuation significantly compared to the end of 2022. Bitcoin, for example, rose from about $16,500 (on New Year’s Eve) to nearly $23,000 30 days later ( an increase of 40%).
The improved market conditions appear to have benefited the California-based investment platform – Robinhood. Its crypto trading volume in January reached $3.7 billion, up 95% from the $1.9 billion mark in December. Nevertheless, the figure is far below the $9.1 billion recorded in January 2022.
Daily Average Revenue Trades (DART) involving digital currencies rose from 200,000 (December 2022) to 300,000 (January 2023). During the first month of the previous year, they were 400,000.
Shares of the company rose about 6% after the announcement and are currently trading at about $10.60.
The problems last year
The tumultuous 2022 significantly shrunk Robinhood’s cryptocurrency revenue and dropped its overall trading activities. Net income was down 43% in Q1 last year, while crypto trading plunged almost 40%. Q3 (12% reduction in crypto-related revenue) and Q4 (24% decrease) was also disappointing.
In addition, the New York State Department of Financial Services (NYDFS) slapped Robinhood with a $30 million fine in August over allegations of violations of anti-money laundering and cybersecurity procedures.
The platform also added its name to the countless list of crypto-related organizations that laid off part of their workforce due to adverse macroeconomic conditions and market crashes. It fired 9% of its employees in April and rejected 23% several months later.
CEO Vlad Tenev outlined rising inflation in the US as the main factor behind the layoffs. He assured that each departing employee would receive regular pay and benefits (including earning equity). The firm also vowed to provide assistance when looking for other job opportunities, cash severance, as well as dental and vision insurance premiums.
Most affected employees were from the operations, marketing and program management divisions.
