Robinhood will acquire one of the oldest crypto exchanges, Bitstamp, for $200 million.
Robinhood is a US-based stock and crypto platform. This platform started as a stock platform, but later jumped into the crypto business. During the big bull run of the popular meme Cryptocurrency Dogecoin (Doge) under the influence of Tesla CEO Elon Musk, Robinhood generated a very large amount of profit through Dogecoin trades. Later, the company invested heavily in its crypto-related business activities. Currently, this crypto exchange is under legal hurdles for offering crypto trading services.
On June 6, 2024, Robinhood announced it would acquire Bitstamp crypto exchange for $200 million in cash.
To assist and complete this deal, Barclays Capital Inc. acted. as Robinhood’s exclusive financial advisor, and Galaxy Digital Partners LLC as Bitstamp’s exclusive financial advisor.
Robinhood is expected to complete the acquisition deal in mid-2025.
Bitstamp crypto exchange was founded in 2011 and currently offers crypto trading services in multiple jurisdictions, including the EU, UK, US and Asia, using 50 crypto licenses.
This is very big news for both Robinhood and the Bitstamp crypto exchange.
Following this news, the trading price of Robinhood ($HOOD) stock rose 4.2% today.
Robinhood, Crypto and SEC
A month ago, Robinhood received a notice from Wells from the US Securities and Exchange Commission (SEC) for offering trading in crypto assets.
According to the SEC’s concerns, Robinhood provided trading in crypto assets that are unregistered securities.
It means that the US SEC agency could initiate enforcement actions against Robinhood for alleged violations of federal laws regarding stock brokers.
It is worth noting that the Robinhood crypto team was already aware of the possible lawsuit from the SEC, so this platform has removed from the platform all those crypto assets that were labeled as unregistered security token in the SEC lawsuits against other crypto companies.
For example, Robinhood removed the cryptocurrencies Cardano (ADA), Polygon (Matic), and Solana (Sol) from the platform in June 2023 to avoid potential legal action.
Also read: A Chinese student faces a prison sentence of 4 years and 6 months for launching a crypto token