Robinhood Deploys Recurring Investments to Combat Crypto Volatility

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Robinhood users can schedule their crypto wallet to buy new coins as often as every day, under a new tool launched by the online trading platform.

The trading app said that users can configure the feature, starting with a $ 1 investment, to buy new coins without paying a commission on a daily, bi-weekly, or monthly schedule. It will gradually be available to US users outside of New York this month.

Saving is a habit, and recurring investments introduce a strategy to grow holdings over time while potentially reducing the impact of market volatility, Robinhood said in a September 9 blog post.

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The feature is planned around a strategy known as “cost averaging in dollars,” he said, which encourages investments at regular intervals to smooth out price fluctuations.

Cryptocurrencies gained popularity among retail investors in 2021, but were marked by several sudden large price drops.

More recently, all major tokens, including bitcoin, ether and cardano, slipped more than 10% across the board on September 8, following regulatory action against Coinbase and technical outages during the launch of bitcoin as legal tender in El Salvador.

Crypto markets can be volatile due to the nature of the industry. Investing on a recurring basis can help you focus on long-term growth, reduce risk and reduce the stress of timing markets, the company added.

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Crypto has become one of the mainstays of the business models of commission-free trading apps, which make money when clients choose to use subscription-linked products, such as derivatives.

Robinhood’s rival eToro said its cryptoasset business led to skyrocketing commission revenue growth earlier this year, with its highest reported trading volumes in bitcoin, XRP, ether, cardano and dogecoin .

To contact the author of this story with comments or news, email Emily Nicolle

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