With Robinhood’s self-custodial wallet in beta testing since September, the company is poised to gain a bigger market share.
Robinhood CEO Vlad Tenev has tweeted that Robinhood’s crypto market share has been growing in the weeks since FTX collapsed. Robinhood initially saw its shares crash by 14% after the Binance-FTX deal fell through.
According to Bloomberg, the equity sell-off caused a loss of about $10 billion. However, Tenev now believes some of that is finding its way back into Robinhood.
While noting that SBF has an equity stake of 7.6% in the business, Tenev stated that Robinhood has no formal relationships with the bankrupt FTX CEO. Afterward, he confirmed that SBF owned a portion of the shares because they were public, and anybody could. Interestingly, the 7.6% shares are owned directly by Emergent Fidelity Technologies Inc., which did not file for bankruptcy with FTX in November.
Also, Tenev reaffirmed that Robinhood had no direct exposure to the now-defunct FTX and Alameda Research. “It’s business as usual at RobinhoodApp,” said Tenev. According to Tenev, the events that led to FTX’s demise provided an opportunity for the firm. “These events weed out the weaker companies that have invested less in risk management and compliance,” he noted
Who Has the Biggest Crypto Market Share?
Robinhood may indeed be gaining FTX’s market share, but FTX had only 10% of the market. Since the firm’s collapse, many of these have been redirected to decentralized exchanges and self-custodial wallets.
Also, Binance and OKX may as well be the biggest gainers from the collapse. Within a few days of FTX’s demise, Binance saw a 7 percentage point increase in market share, from 57% to 64%. Likewise, OKX’s market share grew by 1.1 percentage points from 11.9% to 13%.
With Robinhood’s self-custodial wallet in beta testing since September, the company is poised to gain a bigger market share. According to a company’s blog post, more than 1 million people globally have signed up for the wallet waitlist.
An erosion of trust in centralized exchanges and the growing interest of people in self-custody will most certainly serve Robinhood’s purpose.
Meanwhile, Tenev believes that cryptocurrencies will continue to exist despite the volatility and skepticism in the industry. As a show of faith in the industry, the firm plans to expand its crypto wallet to reach its global clientele soon.
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