Robinhood announced on Thursday that it has acquired Bitstamp, one of the world’s oldest cryptocurrency exchanges, in an all-cash transaction valued at approximately $200 million. The acquisition, expected to close in the first half of 2025, will advance one of Robinhood’s strategic objectives by expanding the company’s presence in international markets.
Bitstamp has been a staple in the cryptocurrency industry since it was founded in Slovenia in 2011, before moving to Luxembourg and the UK. However, its market share has declined in recent years, and despite having between 4 and 5 million customers, Bitstamp now ranks 16th among cryptocurrency exchanges by trading volume. Its largest market is still Europe, but it also has customers in the UK, Asia and the US.
In an interview luckRobinhood Crypto general manager Johan Kjellblat noted that Bitstamp holds 50 active licenses around the world and that the exchange also has active institutional trading operations, adding that the deal marks an important step toward another strategic priority for Robinhood: developing an institutional business to complement its fast-growing consumer offering.
The acquisition comes as a surprise, as there hadn’t been any previous reports that Bitstamp was up for sale. Robinhood is also recovering from a tough 2023 period that saw its stock price plummet from $22 to $7. The downturn, which led to rumors that Robinhood was a takeover target, was part of a broader reckoning that has called into question the health of the entire fintech industry.
Things have changed dramatically in 2024, as Robinhood posted record profits in the first quarter and announced a $1 billion initial public offering last week. buy backMeanwhile, the company has moved away from the boom-and-bust business of stock trading and has begun adding services such as credit cards and retirement accounts that are less vulnerable to market fluctuations.
Robinhood’s acquisition of Bitstamp coincides with a significant rise in the cryptocurrency market, with the price of Bitcoin increasing by more than 60% since the beginning of the year, and the company reporting a threefold increase in cryptocurrency revenue in the first quarter.
The deal could also transform Robinhood’s current crypto business, which revolves mainly around sourcing bitcoin and other currencies from market makers. Acquiring Bitstamp would allow Robinhood to source crypto from its own exchange and entice customers to trade there. Bitstamp offers as many as 85 digital tokens in some markets, compared with the dozen or so that Robinhood offers, as well as lending and staking services.
Robinhood’s attempts to expand its cryptocurrency offerings in the U.S. could face scrutiny from the U.S. Securities and Exchange Commission, which in May signaled plans to sue the company over its token offerings. The SEC’s move comes as part of a broader attack on the crypto industry, but it could be on shaky legal ground as both courts and elected officials have accused the agency of abusing its power.
As for whether Bitstamp will remain a standalone brand or be renamed as a Robinhood product, Kjellbrat said it’s too early to say, as the deal is expected to close next year.
The acquisition was announced by Bitstamp Under discussion The company made the acquisition to raise capital to fund expansion in the UK and Asia, and CEO Jean-Baptiste Graffitiot said at the time that it had no plans to sell.
In Robinhood’s press release announcing the acquisition, Grattofiot said: “Bringing Bitstamp’s platform and expertise into the Robinhood ecosystem will enable us to provide our users with an enhanced trading experience with an ongoing commitment to compliance, security and customer-centricity.”
Barclays Capital acted as financial advisor to Robinhood on the transaction, while Galaxy Digital Partners acted as advisor to Bitstamp.
