Robinhood Markets (ticker HOOD) reported another strong quarter in crypto trading volume, not to mention beating top and bottom line estimates. Overall, trading revenues rose 129% year-over-year in the third quarter, which the company said was driven primarily by cryptocurrency revenue.
Given the rise of Digital Asset Treasuries (DATs) among publicly traded companies this year, Robinhood executives were asked for their thoughts on adopting a corporate treasury strategy.
‘We like to be aligned with the community’ said Shiv Verma, Robinhood’s SVP of finance and strategy and incoming CFO. “Crypto is a big part of our business and our customers are deeply involved in it. The question we continue to ask is whether this is the right move for shareholders as well.”
Verma said putting Bitcoin or other digital assets on the balance sheet has positives that demonstrate a company’s connection to the community, but it does require capital. She also highlighted that shareholders can purchase Bitcoin directly on the Robinhood platform.
“Is this the best use of our capital?” Verma said. “There’s a lot of different things you do, you know, from new products, for growth, investing in tech. So we’re having this debate all the time. And I think the short answer is we’re still thinking about it. There are pros and cons to both, and it’s one that we continue to actively look at.”
Robinhood’s crypto revenue rose 300% to $268 million, boosting its total revenue to $1.27 billion.
According to figures, listed companies own a total of approximately 1.05 million BTC BitcoinTreasurieswith Strategy accounting for more than 60% of this through its reserve of 641,205 bitcoins.
Later during the earnings call, the company was asked about the future of tokenized shares. The platform has expressed a tokenization push in recent months. In October, CEO Vlad Tenev said he expects an asset tokenization framework to emerge across major markets in the next five years.
“One of the things that I think is both a problem and an opportunity with traditional crypto is that crypto and the traditional financial system have been two separate worlds until recently,” Tenev said on Wednesday. “And I think Robinhood Market is uniquely positioned as a scaled crypto company, but also as a scaled company in traditional finance to bridge the two. And actually make room for what we consider traditional assets.”
Analysts at Mizuho Securities said Robinhood continues to “fire on all cylinders” and remains highly bullish on management’s ambition to expand globally and deeper into institutional areas. The company raised its price target for HOOD stock from $145 to $172.
Robinhood shares were down nearly 10% to $129.13 at the time of publication, according to The Block’s HOOD price data.
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