Robinhood’s management is not going to invest in Bitcoin. Why doesn’t the platform need it?
Cryptocurrency is becoming an increasingly important part of Robinhood trading platform’s business model, but the company does not yet have clear plans for direct investments in Bitcoin. CEO Vladimir Tenev stated that. According to him, the idea of holding BTC “arises from time to time” due to the company’s growing interest in digital assets. However, unless you consider holding a certain amount of coins to service customers’ trading operations, the giant does not plan to use Bitcoin as an investment asset for the time being.
This is how the table of the largest Bitcoin holders among public companies looks like. The leader among them traditionally remains MicroStrategy, which has accumulated 444,262 BTC to date. It has invested $27.7 billion in them, with this position now valued at $42.7 billion. Accordingly, it has an unrealised profit of 15 billion – and that’s taking into account the current market correction.
Ranking of public companies with the largest bitcoin holdings
In general, BTC purchases in the world continue. As noted by representatives of the analytical platform CryptoQuant, today Bitcoin-ETFs, governments and the company MicroStrategy account for 31 percent of all known positions of organisations in the first cryptocurrency. A year ago, the figure was 14 per cent, so the trend is clear.
Bitcoin distribution among different market participants in December 2023 and 2024
Which companies are investing in cryptocurrencies
Tenev shared his thoughts on the advisability of investing in bitcoins in an interview with blogger Anthony Pompliano. Here is one of his quotes on what is happening in the market.
We don’t rule it out. But we haven’t done it yet. We’re not in the investment management business.
Change in Robinhood’s share price since the beginning of the year
The CEO also noted that, and although Robinhood has not followed the example of players such as MicroStrategy or Tesla, which hold BTC on their balance sheets, the share price of its platform is “already highly correlated with Bitcoin,” meaning they are moving on a similar trajectory. It’s worth noting that Robinhood’s (HOOD) securities are up 202 per cent in value this year, while BTC’s YTD return has been around 110 per cent.
Tenev believes that if Robinhood starts storing Bitcoin for investment purposes, it could “complicate” investors’ perception of the company, as a likely conflict of interest will emerge. That is, the platform will be interested in the growth of the crypto market, which means it will do its best to popularise digital assets among customers.
According to The Block’s sources, in November, analysts at brokerage firm Bernstein labelled Robinhood shares as the best investment this cycle following Donald Trump’s victory in the US presidential election. They predicted the cryptocurrency giant’s revenues would grow 20 per cent by the end of 2025 and account for 38 per cent of the platform’s total inflows.
Bitcoin’s value change in a month
So far, Robinhood has taken a more conservative stance on its offerings for customers looking to buy and sell coins. The company offers significantly fewer investment opportunities in digital assets and has listed fewer tokens than rivals Coinbase and Kraken.
It is expected that this could change during Trump’s presidency, as the Securities Commission’s undue pressure on the niche will subside and the US Commodity Futures Trading Commission (CFTC) will take over regulation of the crypto sphere. The latter regulator is known for its positive attitude towards coins and its desire to classify them as commodities rather than unregistered securities, something the SEC and its current chairman Gary Gensler have constantly insisted on.
😈 MORE INTERESTING STUFF FROM US AT YANDEX.ZEN!
Meanwhile, MicroStrategy, the largest corporate bitcoin holder, has proposed to increase the number of its Class A common stock and preferred stock to better execute its strategy of continually acquiring bitcoins.
According to the company’s Form 14A filing with the U.S. Securities and Exchange Commission (SEC), the company is proposing to increase the number of Class A common shares from 330 million to 10.33 billion and the number of preferred shares from 5 million to 1.005 billion.
MicroStrategy officials said the proposed stock increase would be required as part of a plan to raise $42 billion in capital. Of that, 21 billion would be raised through equity issuance and another 21 billion through fixed-income instruments, including bonds, convertible bonds and preferred stock. The 21/21 plan aims to fund future Bitcoin purchases by the company.
Changes in MicroStrategy’s share price since the beginning of the year
The statement also described the company’s other offerings, including a new stock-based incentive plan that provides automatic stock grants to new board members. In last Friday’s 8-K filing, MicroStrategy expanded its board of directors from six to nine members, adding Brian Brooks, Jane Dietz and Gregg Winiarski. Brooks served as CEO of Binance for three months in 2021, while Dietz has been on Galaxy Digital’s board since 2022.
The exact date of the special shareholder meeting to vote on these proposals has not yet been announced, but it is scheduled for 2025.
It seems that not all participants in the financial markets are interested in directly buying bitcoin and other cryptocurrencies. However, the situation will definitely change for the better if a national BTC reserve is announced by the US government.
Look for more interesting things in our crypto chat. We are waiting for you there right now.
SUBSCRIBE TO OUR CHANNEL IN TELEGRAM TO KEEP UP TO DATE.
Related posts
