Robinhood Acquires Bitstamp for $200 Million, Expanding Global Crypto Presence

Robinhood acquires Bitstamp for $200 million, expanding its global cryptocurrency presence.

Robinhood Markets has announced its acquisition of Bitstamp, one of the world’s oldest cryptocurrency exchanges, for $200 million. This strategic move aims to enhance Robinhood’s global crypto presence and attract institutional clients, marking a significant step in the company’s expansion beyond the U.S.

Key Takeaways

  • Robinhood acquires Bitstamp for $200 million in cash.
  • The acquisition will expand Robinhood’s global crypto presence and attract institutional clients.
  • Bitstamp holds over 50 active licenses and registrations globally.
  • The deal is expected to close in the first half of 2025.
  • Robinhood’s crypto business has surged in recent quarters.
  • The acquisition comes amid regulatory scrutiny from the SEC.

Strategic Expansion

Robinhood’s acquisition of Bitstamp is seen as a strategic move to expand its footprint and improve its service offerings. Bitstamp, founded in 2011, is one of Europe’s largest and most regulated crypto exchanges. It offers spot trading for over 85 cryptocurrencies and provides services like institutional lending and staking.

Johann Kerbrat, General Manager of Robinhood Crypto, highlighted Bitstamp’s resilience through market cycles and its strong global reputation. He stated, "The acquisition of Bitstamp is a major step in growing our crypto business. Bitstamp’s highly trusted and long-standing global exchange has shown resilience through market cycles."

Regulatory Challenges

The acquisition comes as Robinhood’s existing crypto business faces scrutiny from regulators. The Securities and Exchange Commission (SEC) recently issued a Wells Notice to Robinhood, indicating potential enforcement actions. Despite these challenges, Robinhood remains committed to expanding its crypto offerings.

Dan Gallagher, Robinhood’s Chief Legal, Compliance, and Corporate Affairs Officer, expressed disappointment over the SEC’s decision but reaffirmed the company’s belief that the crypto assets listed on its platform are not securities.

Financial Performance

Robinhood’s crypto business has significantly boosted the company’s earnings in recent quarters. The company reported that revenue from its crypto business more than tripled in the first quarter from a year earlier to $126 million. This growth has been driven by a surge in demand for digital assets and the approval of the first spot bitcoin exchange-traded funds in the U.S.

Future Prospects

The acquisition of Bitstamp is expected to increase competition in the crypto exchange market, particularly against major players like Coinbase. Robinhood’s recent financial performance shows its growing influence in the cryptocurrency sector.

Bitstamp’s CEO, JB Graftieaux, expressed enthusiasm about the merger, emphasizing the enhanced trading experience and continued commitment to compliance and customer-centricity that Bitstamp would bring to Robinhood’s ecosystem. Graftieaux and the existing leadership team will remain in place post-acquisition, ensuring continuity and stability.

The deal is expected to close in the first half of 2025, pending regulatory approval. Barclays Capital served as the financial advisor to Robinhood, while Galaxy Digital Partners advised Bitstamp.

Sources

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