Robinhood is by no means an ‘elder’ in the cryptocurrency industry, only opening up its cryptocurrency division in early January. Despite this, Robinhood’s co-CEO, Baiju Bhatt, believes that the cryptocurrency market has a strong future ahead of itself.
“Bitcoin Just Keeps on Coming Back”
During an interview with Yahoo Finance, Bhatt expressed his positive sentiments regarding the cryptocurrency market as a whole.
Bhatt pointed out that he believes that sovereign nations will adopt cryptocurrencies as a currency of choice. This statement is in line with what CFTC commissioner said earlier this week, also stating that he believes small nations ‘may become dependent on virtual assets for survival.’
With events like the recent Venezuelan hyperinflation becoming prevalent, smaller nations may begin to turn to cryptocurrencies as a decentralized and secure way to transfer value between individuals and entities.
When asked about his recent involvement in crypto, Bhatt stated:
“We have been thinking about it for a couple of years… We had been watching it (Bitcoin) over the years and we noticed one thing which we really looked at when considering when to offer it to our consumers, which is its resiliency. It has this tenacity to it where it just keeps on coming back.”
In January, Robinhood announced the creation of a cryptocurrency service which was well received by the public, with hundreds of thousands of consumers getting their names down on the early access mailing list.
However, once the official release of Robinhood Crypto occurred, it was met with mixed reviews. At the time, Robinhood Crypto was only open to a few U.S. states with support for only a few cryptocurrencies.
In fact, Robinhood only allows for users to trade cryptocurrencies and does allow for the deposit or withdrawal of cryptocurrencies, essentially making it just a price speculation platform.
However, the co-CEO also noted that he believes Bitcoin ‘is going to be something that is going to stick around for a while’ and has not given any regard to daily volatility in the market.
It has also become apparent that Robinhood is working to expand their cryptocurrency service, successfully raising $363 million in May to help expand their product line.
Coinbase vs. RobinHood
If Robinhood, along with this capital influx, can offer cryptocurrency deposits and withdrawals in more countries, its crypto service may begin to encroach on current market leaders. Drawing parallels between the Robinhood and Coinbase services, you can see that they are both aimed at retail consumers for mass adoption. Additionally, they are both fintech startups based in the heart of Silicon Valley, with similar goals and aspirations.
Taking this into mind, Coinbase is evidently one of Robinhood’s largest competitors. Robinhood obviously has a step up against Coinbase’s fee structure, with the growing cryptocurrency service offering commission-free cryptocurrency trading, a welcome feature in a world of 3% fees.
Bhatt did acknowledge Coinbase’s fee structure during the aforementioned interview, despite commending Coinbase as a ‘great company.’
We (Robinhood) think that we are good at building the best consumer products and making sure that we can offer them at the best prices. And while you may end up paying a fee of 4% perhaps more on Coinbase, on Robinhood it is free and we think our interface is easy to use as well.”
But, as of one week ago, Coinbase reached its six-year anniversary, becoming one of the most aged institutions in the cryptocurrency industry.
The team at this growing financial service may have a tough time taking the proper routes to ensure a successful transition to support high volume cryptocurrency trading, especially in such a volatile and unforgiving market.
If Robinhood wants to take over Coinbase, its team will need to learn a lot and may need to offer a variety of other cryptocurrency related services to ensure that its foray into the cryptocurrency market is a resounding success. But many are rooting for Robinhood’s success because if this service succeeds, it will surely increase retail adoption through an easy to use fiat onramp.