Robinhood Financial, California-based financial services company, launches crypto trading free of commission in some U.S. states, with others on the waitlist.
Investors in California, Massachusetts, Missouri, and Montana are able to trade in Bitcoin and Ethereum with no fee, but users will still be responsible for fees charged by the underlying exchanges. More tradeable coins are to be added later.
Robinhood Financial is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC), which protects securities customers of its members up to $500,000. Opened in 2013, Robinhood is a popular stock trading app within millennials with 4 million registered users.
In January this year, the company launched Robinhood Crypto which provides competition to the hundreds of other bitcoin exchanges including US-based Coinbase, which is among the leading trading platforms. Now, with lack of fees, Robinhood is likely to lure more crypto investors.
As part of the launch, the stock brokerage also released the launch of a social media-type platform named Robinhood Feed. It is an online social discussion forum that gives investors a possibility to discuss different cryptocurrencies, market trends and news online.
Currently, Robinhood Financial has over $100 billion in transaction volume on its brokerage platform.
The first announcement of the Robinhood’s plans to start zero-fee crypto trading attracted one million users in just the first four days. The main idea of this commission-free trading is to bring cryptocurrencies to a wider audience of investors providing them with a platform that “democratizes” trading through expanding the group of potential investors using mobile and web-based apps.
The company strives to make traditional and cryptocurrency trading more accessible for its customers excluding their additional expenses for paying the commission.
While traders are limited to trading BTC and ETH, they can access market data on more than a dozen altcoins. Robinhood Crypto offers services like “instant access” to funds via deposits or stock sales, which is a streamlined approach that traders are sure to like versus the alternative of waiting for their funds to arrive on other platforms.
Robinhood’s Twitter followers asked when the platform would open to investors in other states. Robinhood Crypto was also expected to reach New Hampshire, but Robinhood also said the rollout would be “gradual” and added that the company plans to expand its crypto trading functionality “in many more states later.”
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