Robinhood is a crypto trading platform

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Retail traders love to trade cryptocurrencies.

Why it matters: Robinhood has grown in popularity as a brokerage app offering commission-free stock trading. But the company’s recent performance suggests that the current crop of retail traders are more interested in cryptocurrencies than in stocks.

Leading the News: Robinhood reported on Wednesday that second-quarter trading revenue jumped 141% year over year to $ 451 million.

Cryptocurrency trading accounted for $ 233 million of that trading income, more than options trading income ($ 165 million) and equity trading income ($ 52 million) combined. More than 60% of its 22.5 million funded accounts traded cryptocurrencies in the quarter. The month ended June 30, 2021, is the first quarter that a greater share of new clients placed their first trade in crypto rather than in stocks, ”the company said.

Threat level: The company warned, however, that trading will slow down in the next quarter.

“For the quarter ended September 30, 2021, we expect seasonal headwinds and lower business activity across the industry to result in lower revenues and significantly fewer new funded accounts than in the previous quarter.” , the company said.

State of play: Robinhood stock fell 9% after the company reported its results.

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