Robinhood Introduces Feature To Protect Investors From Crypto Volatility

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The Robinhood stock and cryptocurrency trading app would explore a way for users to be better protected against volatile crypto prices.

According to a Bloomberg report on Tuesday, the trading app is working on a feature called Price Volatility Protection, which would change certain crypto orders based on price movements. A message in the features code states that Robinhood may sometimes ignore your recurring orders or purchase less than the amount chosen to protect transactions from price volatility, but will notify users before taking such action and will never buy more than the selected amount.

We’ve done a lot of work behind the scenes to provide our crypto clients with the features they’ve requested, said Robinhood CEO Vlad Tenev. We want to safely introduce new features, and there are a lot of things we need to get early on. “

Reports on the proposed feature come after Robinhood briefly suspended instant deposits for crypto purchases in January. The trading app cited “extraordinary market conditions” at the time, likely referring to Reddit’s retail investors pumping Dogecoin (DOGE) the token jumped over 900% at the time and was volatile throughout the year, reaching an all-time high. price of $ 0.68 in May.

Robinhood later said that 34% of its first quarter 2021 revenue was directly attributable to transactions for the memes-based cryptocurrency, and claimed that its business could be affected “if the Dogecoin markets deteriorate or if the price of Dogecoin was going down “. According to the trading app, 17% of its total revenue for the same period was from transaction-based revenue generated by all crypto transactions, with over 9.5 million clients trading around $ 88 billion.

Related: Robinhood COO: We Allowed More Women To Trade Crypto

In addition, US regulators have reportedly turned their attention to the trading app. The Financial Sector Regulator announced in June that it would penalize Robinhood by around $ 70 million based on the results of an investigation alleging the enforcement had caused widespread and significant damage to thousands of people. users and had exposed systemic oversight failures as early as September 2016. Robinhood said it has reached an agreement in principle with the regulator to pay some of the fines on a disallowed, not denied basis.

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