Watch out crypto exchanges as popular stock trading app ‘Robinhood‘ known for its absolutely streamlined, no-commission approach is coming to steal your space in the crypto world. On Thursday, Robinhood announced that by February next month, it will allow its customers to buy Bitcoin and Ethereum without any added transaction fees. However, for now, customers will be able to track the prices, news and also set up alerts for Bitcoin and 15 other cryptocurrencies.
Robinhood is a popular stock trading app within millennials with over 3 million registered users having an average age of 26. The digital currency trading platform of Robinhood will go live the next month and will allow users in the states of California, Massachusetts, Missouri, Montana and New Hampshire, where it has received regulatory approvals to acquire digital currencies with no minimum purchase amount.
The popular U.S. exchange ‘Coinbase’ which clocked a billion-dollar revenue last year currently charges its customers about 1.5 to 4 percent fees. With the exponential increase in the number of investors rushing to the crypto exchanges the price of trading virtual digital currencies have considerably gone high above $20.
On this new development, Vlad Tenev, Robinhood co-founder said: “We’re planning to operate this business on a break-even basis and we don’t plan to profit from it for the foreseeable future. The value of Robinhood Crypto is in growing our customer base and better serving our existing customers.”
While talking to CNBC, Tenev further stated that “Cryptocurrencies have become the first foray into investing and financial services to a large number of people. Now it’s become more and more clear [that bitcoin is an] investing asset. We’re not seeing significant impact from cryptos on the size of the equity market. Marketwide, trading is increasing, investing is increasing.”
Robinhood app currently hosts a day and night theme for the traditional stock markets to indicate the open and close times. Unlike this, the crypto section is styled with the 80s Tron design in order to indicate the 24-hour trading window. Regarding the operations, Robinhood’s co-CEO Baiju Bhatt told Fortune that the company will act like as a broker-dealer instead of an exchange in the cryptocurrency market. For this, Robinhood is said to partner with other big institutions which would help to acquire cryptos on behalf of customers.
As the app rolls-out for trading next month, initially, customers will get to trade only Bitcoin and Ethereum on the Robinhood platform. Tenev said that “We’re extremely selective about the cryptos we’re making available on the platform. We’re introducing those first because these are the most mature coins that people are trading these days. Multiple times people have declared them dead and they’ve come back stronger than ever.”
The company is also adding the necessary security features to prevent any unforeseen acts of wallet thefts. The company said that the crypto feature of the Robinhood app will feature a new two-factor authentication along with the option of integration with the authenticator apps. This will make sure that users don’t get their wallets stolen or dumped in that case. In order to implement this, Tenev says that “There are several senior world-class people that we’ve hired recently that are building the system in-house.”