On Thursday, Robinhood unveiled its crypto service in the EU, offering users the chance to buy and sell more than 25 digital currencies. This marks the Robinhood platform's second expansion outside the U.S., following its initiation of a waitlist for U.K. customers to join their stock-trading platform in early 2024. With the U.S. regulating the crypto sector tightly, many of the major American crypto firms are looking to the EU to expand.
On Thursday, Robinhood, a leading online brokerage firm, announced the introduction of cryptocurrency trading in the European Union as a part of its effort to capitalize on international markets. Customers will be able to purchase, sell, and store over 25 types of digital currency such as Bitcoin, Ethereum, Ripple, Cardano, Solana, and Polkadot. Robinhood plans to introduce the ability to transfer and "stake" (earn rewards) crypto in 2024, too. This follows the company's prior declaration that it intends to launch stock trading services to U.K. clients by the beginning of 2024. Robinhood recently initiated a waitlist that will offer up to 5% return on deposits made by customers.Robinhood is incentivizing EU users to utilize its service by allowing them to reap the benefits of free Bitcoin if they trade regularly and recommend the platform to friends. Users are eligible to receive up to one Bitcoin, based on their monthly trading volumes and the number of referrals. In recent times, some significant crypto firms in the U.S. have shifted their focus to Europe as they have been hit with legal disputes from the U.S. Securities and Exchange Commission for supposed violations of securities laws.In contrast to this, the European Union has proposed a regulatory framework, the Markets in Crypto-Assets regulation, for crypto trading platforms and issuers of stablecoins. This regulation seeks to implement stricter rules governing these entities.
Johann Kerbrat, the general manager of Robinhood Crypto, stated that the EU was chosen as its first international target market for its crypto product due to the region's comprehensive laws for the crypto industry. He explained that the regulations are one of the best in the world, thus making it an optimal location to kick off its expansion. Robinhood also highlighted the transparency and security features within its European crypto offering, which includes transparent spread display for sell and trade orders, as well as the assurance of not commingling customer coins with business funds aside from operational purposes. Furthermore, its customers' coins are stored in cold wallets, disconnected from the internet, and its crime insurance policy with Lloyd's provides protection against losses related to theft or cyber breaches. The past couple of years has seen numerous crypto thefts, the most infamous being the HTX exchange and Heco bridge hack initiated by Justin Sun which cost an estimated $115 million. The issue of trading venues and custodians converging became a major issue when FTX, a multi-billion dollar crypto exchange, went bankrupt due to its market-making sister firm, Alameda Research, abusing customer funds for high-risk token bets.
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