Robinhood Reports A 12% Drop In Crypto Revenue In Q3

Even though it lost less money than expected, the American financial services company Robinhood's revenue from crypto transactions went down in Q3 2022.

As per the earnings report released Wednesday, the crypto transaction revenue declined 12% to $51 million in the third quarter of the year. In its second-quarter results, Robinhood reported a 7% increase in crypto transactions, totaling $58 million.

The California-based company reported a revenue of $54 million in Q1 2022 and $88 million in Q1 2021 from cryptocurrency transactions.

The decrease in transaction revenue comes at a time when the company is doubling down on crypto, listing Cardano (ADA) in September along with Uniswap (UNI), Stellar Lumens (XLM), and Avalanche (AVAX). Additionally, the company also debuted the first stablecoin on its platform, USDC.

In its report, Robinhood highlighted its numerous crypto ventures, including debuting the beta version of its self-custodial crypto wallet to the first 10,000 users on its waitlist, which is aimed at giving users more direct control over their crypto and access to Web3.

The earnings report does not mention less optimistic events surrounding the crypto arm of the California-based company. Robinhood's CEO Vlad Tenev recently revealed that the company had let go of 23% of its employees.

Tenev stated that the company hired many employees for its crypto arm "under the assumption that the heightened retail engagement we had been seeing with the stock and crypto markets in the COVID era would persist into 2022," and it did not happen as the market turned bearish.

It is also crucial to note that Robinhood suffered a net loss of $175 million in Q3, which is significantly less than its net loss of $295 million in Q2 2022. Meanwhile, the company's total net revenues increased by 14% to $361 million.

Recently, there were talks of Sam Bankman-Fried, the CEO of crypto exchange FTX, acquiring Robinhood but the rumors were turned down later.