Robinhood Crypto Acquisition Fuels Stock Surge as Competition Intensifies

Robinhood’s shares rose nearly 3% on Monday following the completion of its acquisition of the crypto exchange Bitstamp.

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Robinhood Crypto Acquisition Fuels Stock Surge as Competition Intensifies The Trump Effect Crypto Market Movers

However, analysts suggest the stock could be poised for further growth. Bernstein estimated that Robinhood’s continued push into digital assets could drive its stock price up by another 54%, reaching $105 by this time next year.

“We expect [Robinhood] to continue gaining market share in trading revenues driven by strong product pipeline across equities, crypto, and disruptive products such as prediction markets and tokenisation,” noted Guatam Chhugani and other analysts at the firm.

The deal, announced in June 2024, exemplifies the latest strategic move by traditional financial firms into the cryptocurrency market. Other players, both established institutions like Morgan Stanley and Morgan Stanley E*Trade, and fintech giants like Revolut, are rapidly expanding their digital asset offerings.

According to recent reports, Revolut plans to enter the crypto derivatives market, while traditional crypto exchanges like Kraken are integrating features such as traditional stock trading.

Banking giants including JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo are also reportedly exploring the launch of their own stablecoins.

The Trump Effect

The increasing competition is indicative of the maturing crypto landscape. These changes began well before US President Donald Trump’s election victory on a platform promising crypto support.

Two key developments were the approval of the first Bitcoin ETF by the SEC under SEC Chair Gary Gensler, followed shortly by the approval of Ethereum ETFs. These events suddenly shifted Wall Street’s stance.

Financial leaders like BlackRock CEO Larry Fink began highlighting the potential of cryptocurrencies and tokenisation as established asset classes. Robinhood’s home advantage is cited by Bernstein analysts, who noted the firm began offering crypto trading in 2021. Their May analysis estimated Robinhood controlled around 30% of the US retail crypto-trading market.