Robinhood Crypto Revenue Falls Nearly 50% in Q1

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Robinhood’s crypto revenue and app-based crypto trading volume fell by nearly half in the first quarter, showing how weaker digital asset activity weighed on the brokerage even as other parts of the business grew.

Crypto transaction revenue dropped 47% year over year to $134 million from $252 million. Robinhood App crypto notional trading volume fell 48% to $24 billion, according to the company’s first-quarter earnings release.

Crypto Weighs on Transaction Growth

The crypto decline offset stronger activity in equities, options and event contracts. Robinhood said total transaction-based revenue rose 7% year over year to $623 million, helped by options revenue of $260 million, equities revenue of $82 million and other transaction revenue of $147 million, which mainly includes event contracts.

The sharp decline in crypto revenue also marked another weak quarter for one of Robinhood’s most volatile business lines. The company still reported $66 billion in total crypto notional trading volume, but that figure included $42 billion from Bitstamp. Robinhood completed its acquisition of Bitstamp last year, giving it a bigger institutional and global crypto footprint even as app-based retail activity slowed.

Earnings Miss Expectations

Robinhood reported first-quarter revenue of $1.07 billion, up 15% from a year earlier. Net income rose to $346 million, while diluted earnings came in at 38 cents per share.

Robinhood earnings depend heavily on trading activity, and drops in crypto volume can significantly impact results even as other areas grow.

Event Contracts Soften the Blow

Robinhood’s strongest growth came from event contracts, with record event contracts traded of 8.8 billion and other transaction revenue, which primarily consists of event contracts revenue, rising 320% year over year to $147 million.

The growth also comes as prediction markets face a widening regulatory fight in the US. Robinhood’s expansion in event contracts gives it another fast-growing trading category, but one that is becoming more exposed to legal and jurisdictional disputes.

Crypto Remains Important But Less Dominant

The first-quarter figures show that crypto is still a meaningful revenue source for Robinhood, but it is becoming less dependable as retail trading activity cools.

The broader platform is still growing. Robinhood reported more funded customers, higher total platform assets and continued growth in Robinhood Gold. But crypto’s 47% revenue drop underlines the risk of relying too heavily on market-sensitive trading income.

For Robinhood, the near-term challenge will be using Bitstamp, event contracts, subscriptions and international expansion to help offset weaker retail crypto cycles. If crypto volumes recover, the business could regain a major revenue tailwind. If they stay soft, Robinhood’s d