Distinguished wealth supervisor Ross Gerber has slammed Robinhood following its newest quarterly report.
The monetary pundit has described the retail buying and selling platform as nothing greater than a “playing app.”
The corporate’s Q1 report has proven an enormous drop in cryptocurrency volumes.
CLARITY Act Finalized: What It Means for Crypto
XRP’s Mini-Demise Cross Hints at Dive Down, Shiba Inu (SHIB) Breakout Seems to be Bleak, Is Ethereum’s (ETH) $2,000 Saved? Crypto Market Evaluation
The shares of Robinhood (HOOD) have tumbled by roughly 8% in post-market buying and selling.
“Nothing greater than a on line casino”
Robinhood’s heavy reliance on high-risk and speculative buying and selling exercise has apparently backfired.
“They solely earn cash whenever you gamble and lose on…. inventory choices, crypto and betting,” Gerber said. “It is a playing app, nothing extra. They earn cash whenever you lose.”
Robinhood’s most profitable quarters have traditionally been pushed by huge retail hypothesis in meme shares and unstable cryptocurrencies.
The crypto hunch
Robinhood posted a 15% year-over-year enhance in whole income to $1.07 billion, however it nonetheless fell wanting Wall Avenue’s $1.14 billion estimate.
Adjusted earnings per share got here in at $0.38, which was beneath expectations.
As talked about above, the platform has skilled an enormous 47% collapse in crypto buying and selling income. It has plummeted to $134 million from $252 million a 12 months earlier.
The platform is ready for the subsequent main market cycle to deliver the dopamine-driven retail crowd again.
The silver lining
In fact, crypto tanked, however Robinhood noticed an enormous increase in prediction market bets. Income from “different transactions” skyrocketed 320% year-over-year to $147 tens of millions
The corporate has additionally pulled in roughly $50 million in subscription income.
Through the earnings name, Robinhood CEO Vlad Tenev actively tried to shift the narrative away from the platform’s dependence on cryptocurrency worth cycles.
“I need to get away from speaking concerning the worth of Bitcoin,” Tenev advised traders.