KEY POINTS
- Robinhood said the acquisition is part of its efforts toward expanding outside the US
- Congratulatory posts poured in, but so did queries about Robinhood's plans moving forward
- Some users questioned why a company "notorious" for disabling the buy button would acquire a crypto firm
Financial services giant Robinhood announced Thursday that it has agreed to acquire cryptocurrency exchange Bitstamp in a $200 million cash deal, and the digital assets community on X (formerly Twitter) have had mixed reactions to the announcement.
"This acquisition will bring Bitstamp's globally-scaled crypto exchange to Robinhood, with retail and institutional customers across the EU, UK, U.S. and Asia. This strategic combination better positions Robinhood to expand outside of the U.S. and will bring a trusted and reputable institutional business to Robinhood," the company said Thursday.
The deal is expected to close in the first half of 2025, but will still be subject to regulatory approvals and other closing conditions, Robinhood added.
Johann Kerbrat, the general manager of Robinhood's digital assets arm Robinhood Crypto, said the acquisition is a "major step" in the Menlo Park-based company's crypto business.
“It accelerates our plans for international expansion, particularly in crypto," says Robinhood CEO @vladtenev on what excites him about acquiring @Bitstamp. "Second it brings an exchange to Robinhood." pic.twitter.com/mCwqDlLtBy
— Squawk Box (@SquawkCNBC) June 6, 2024
Robinhood CEO Vlad Tenev told CNBC's Squawk Box Thursday that Robinhood had been thinking of providing users with an exchange. He said the company had been talking to market makers, who deemed that "there's a clear need for another player in the market." He went on to say that the acquisition opens up a pathway for Robinhood to serve institutional customers.
The crypto community on X (formerly Twitter) appears divided over the news, with some celebrating the development, and others unsure whether the acquisition is a good thing for the space or not.
There were significant names and entities in the crypto space that congratulated Robinhood for the acquisition, including Cointelegraph, prominent trader @Wallstreet_bnb, and the team behind the Solana blockchain's $MUZKI token. Truflation, whose $TRUF token was recently listed on Bitstamp, said it was "proud to play a small role" in Robinhood's future success.
One user said it seems Robinhood's move "is a step backwards for crypto," considering how the financial titan "disables the buy button when they feel like protecting hedge funds." Another user agreed, saying Robinhood is "notorious for removing the buy button," but is now purchasing a crypto company, making the move confusing.
One user pointed out that U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler "isn't going to like this move," seemingly referring to the recent issuance of a Wells Notice from the regulator to Robinhood Crypto.
The crypto community rallied behind Robinhood after news of the Wells Notice emerged earlier in May. The company said it "cooperated" with the SEC when it received investigative subpoenas but still received the Notice.
It remains to be seen how Robinhood will leverage Bitstamp when the acquisition closes. Tenev did say that acquiring the crypto exchange should help "accelerate" its vision as it believes digital assets "will fundamentally reorganize" the financial system.
