Robinhood Said Users to Manage Their Own Crypto Wallets
Robinhood is an investing app that is doubling down on the launching of new products, particularly in its crypto unit, in hopes it will help to increase the business. CEO Vlad Tenev announced the company’s plans to leave non-custodial crypto wallets at the Permissionless Defi conference in Florida today, starting with a waitlist already open.
The market environment has challenges for the company as trading volumes have dropped. Robinhood’s net revenue dived 43% to $299 million in Q1, with crypto trading revenue specifically lowering 39% to $54 million (meaning crypto trading accounted for about 18% of Robinhood’s total revenue before the end of March).
Robinhood has been actively growing its crypto arm since the end of Q1 in a bid to attract users and boost the trading volume. In the last month or so, the exchange has closed custodial crypto wallets to its users, listed four new coins including Solana and Shiba Inu, and announced it would work with the Bitcoin Lightning Network to enable faster, lower-fee transactions with .22 million customers to interact with its crypto products today, Robinhood CTO Johann Kerbrat told TechCrunch in an interview.
Now that it’s launching a non-custodial wallet, users will be able to access it and manage their digital assets, including cryptocurrencies and decentralized apps (dApps) including NFTs, Kerbrat said. Kerbrat watched two key areas of differentiation for Robinhood’s non-custodial wallet, which he said he will support multiple blockchains — its user-friendly design and no-fee setup for customers.
Coinbase is another popular crypto exchange that also offers two types of wallets — custodial and non-custodial — in two different apps, the latter being Coinbase Wallet. Coinbase Wallet is free to use but passing on specific transaction fees to its users is required.
Robinhood, on the opposite, won’t charge its customers any fees for using its non-custodial wallet, including network fees for trading and swapping crypto, Kerbrat said.
The Robinhood non-custodial wallet, which Kerbrat said still hasn’t been officially named, will work as a standalone app. In addition to allowing users to store NFTs in the wallet, it will also serve as a point of connectivity to the decentralized finance (Defi) ecosystem, giving customers access to Defi protocols through which they can earn a production on their coins by lending or verifying the transactions, Kerbrat said.
To open up an account, he added that users won’t need to share any personal information with the exchange unless they choose to connect their non-custodial wallet with their Robinhood app.
Kerbrat hopes the announcement today will motivate app developers and protocols to work with Robinhood’s wallet.
Robinhood’s shares are well disposed over 20% last week after FTX, a crypto exchange run by billionaire Sam Bankman-Fried, disclosed that it had purchased a 7.6% stake in the company.