Robinhood Markets, Inc. is an American financial services company based inMenlo Park, California. It provides anelectronic trading platform that facilitates trades ofstocks,exchange-traded funds,options,index options,futures contracts, event contracts onprediction markets, andcryptocurrency. It also offerscryptocurrency wallets,wealth management,credit cards and other banking services, some in partnership with banks insured by theFDIC, as well as a news website, Sherwood.News.[2] The company's revenue comes frompayment for order flow and commissions on options (25% of Q4 2025 revenues), cryptocurrency (17% of Q4 2025 revenues), equities (7% of Q4 2025 revenues), and other products such as futures and event contracts (11% of Q4 2025 revenues); net interest income frommargin lending, interest earned on corporate and customer cash balances,securities lending, and credit cards (32% of Q4 2025 revenues); subscription fees on its Robinhood Gold product (4% of Q4 2025 revenues); and other sources, primarilyadvertising revenue from Sherwood.News (4% of Q4 2025 revenues).[3][2] The company has 27.0 million funded customers with 28.4 million investment accounts and $324 billion in assets under custody.[3] Its platform is available in the U.S., the UK, and, for trading cryptocurrency and tokenized stocks and ETFs only, in theEuropean Union.[2] Over 200 million option contracts and 3 billion event contracts are traded monthly on the Robinhood platform.[3]
The company has been referred to as an innovator in zero-commission stock trading, as it relies on other sources of revenues.[4] Robinhood has targetedmillennials as customers; in March 2025, the average age of its customers was 35.[5]
Robinhood was founded in April 2013 byVladimir Tenev andBaiju Bhatt, who had previously builthigh-frequency trading platforms for financial institutions in New York City.[9] The company is named afterRobin Hood, based on its self-stated mission to "provide everyone with access to the financial markets, not just the wealthy".[10][9] They aimed to design amobile app that was free, easy to use, and addictive.[10][11] Tenev and Bhatt served as co-CEOs from 2013 to 2020, when Tenev became the sole CEO and Bhatt becamechief creative officer.[12][13]
In March 2019, Robinhood acquired MarketSnacks, a financial newsletter.[22] Robinhood launched banking products with insurance from theFederal Deposit Insurance Corporation via partner banks in December 2019.[23][24]
In the second quarter of 2020, during the2020 stock market crash, compared to the first quarter of 2020, trading volumes increased 139%, more than any other major brokerage.[11] In March 2021, Robinhood acquired Binc, a recruiting firm.[25] In July 2021, the companywent public and was listed onNasdaq.[26][27]
In August 2021, Robinhood completed the $140 million acquisition of Say Technologies, a company that helps shareholders vote proxies and ask questions of management.[28] In December 2021, Robinhood acquired Cove Markets, a developer of cryptocurrency trading platforms.[29]
In April 2022, Robinhood cut its workforce by 9%.[30] In August that year, the company announced additional layoffs of 23% of its workforce, mostly in operations, marketing and program management.[31][32] The following June, Robinhood announced additional layoffs of 150 employees or about 7% of its staff.[33][34]
In June 2023, Robinhood completed the $95 million acquisition of X1, a credit card issuance startup.[35][36] In December 2023, Robinhood acquired Chartr, a publisher of a daily financial newsletter.[37]
In March 2024, Robinhood acquired Marex FCM, a broker offutures contracts.[38] Robinhood also expanded its services to the United Kingdom.[39][40][41] The following month, Robinhood launched its "Sherwood News" website and a rebrand of its financial newsletter Snacks.[42] In July 2024, Robinhood acquired Pluto Capital, an AI-powered investment research platform.[43] In November 2024, Robinhood completed the $300 million acquisition of TradePMR, a wealth management platform.[44][45]
In March 2025, Robinhood announced the launch ofwealth management services.[46] The following month, theBank of Lithuania granted the company a brokerage license to operate inLithuania.[47] Soon after, Robinhood received itsMiFID and MICA licenses, allowing Robinhood Europe to operate as acryptocurrency exchange.[48] In May 2025, Robinhood completed the $180 million acquisition of WonderFi, a cryptocurrency trading platform.[49]
In June 2025, the company launched trading in tokenized ETFs and stocks in the European Union.[50][51][52] Robinhood also completed the $200 million acquisition ofBitstamp, a cryptocurrency exchange.[53]
Robinhood raised $110 million in a Series C round at a $1.3 billion valuation in April 2017, bringing its total funding raised to $176 million. Investors includedYuri Milner ofDST Global, Greenoaks Capital, andThrive Capital.[61][62][63] In May 2018, Robinhood closed a $363 million Series D financing round led by DST Global, bringing its total equity funding to $539 million.[64][65] Robinhood raised $323 million in a Series E venture funding round led by DST Global, the following July.[66]
In May 2020, Robinhood raised $280 million in a Series F venture funding round led bySequoia Capital at a pre-money valuation of $8.3 billion.[67][68][69] Three months later, the company announced a $200 million Series G funding round from a new investor,D1 Capital Partners.[70][71][72][73]
In November 2022, as part of thebankruptcy of FTX, the U.S. government seized the 7.6% stake in Robinhood owned byAlameda Research, which were used as partial collateral for a transfer of at least $4 billion fromFTX. The shares were sold back to Robinhood for $605 million, or $10.96 per share.[77][78][79]
Controversies
Order execution
Robinhood receives a significant portion of its revenue frompayment for order flow and relies on this source of revenue more than its rivals. This has been criticized as a "backdoor commission" orkickback. The company has been criticized for routing orders tomarket makers that pay the most instead of those that offer the best order execution. TheFinancial Industry Regulatory Authority fined Robinhood $1.25 million in December 2019 for failing to ensure that its customers received the best price for orders, instead routing orders based on payments that it receives from market makers.[80][81]
In December 2020, the company paid $65 million to settle accusations by theU.S. Securities and Exchange Commission that it failed to disclose these kickbacks, that Robinhood customers' orders were executed at prices that were inferior to other brokers' prices resulting in $34.1 million in losses by customers on certain trades compared to if they were executed by other brokers at thebest execution, and that Robinhood made false and misleading statements to the contrary.[82][83]
Also in December 2020, Robinhood was sued in theUnited States District Court for the Northern District of California for failing to disclose to customers that it received payment for order flow, leading to inferior trade prices. As of January 2025, the plaintiffs were seekingclass action status. The case was consolidated with others underKwon v. Robinhood Financial LLC.[84]
Security breaches
In July 2019, Robinhood admitted to storing some customer passwords in an unencrypted cleartext format within internal systems. However, the company found no evidence of abuse. Passwords were then hashed using theBcrypt algorithm and the company advised customers to change their passwords.[85]
In October 2020, Robinhood found that almost 2,000 Robinhood accounts were compromised and that the hackers had siphoned off customer funds. Robinhood alleged that users' personal email addresses had been compromised outside of Robinhood and promised to fully compensate customers if they lost money because of unauthorized activity.[86][87][88]
In November 2021, avoice phishing scheme on a Robinhood employee resulted in about 5 million customers having their email addresses stolen, 2 million customers having their full names disclosed and 300 customers having their dates of birth disclosed.[86][89] It is believed that Conor Brian Fitzpatrick, owner ofBreachForums, who was responsible for the2021 FBI email hack and was arrested in March 2023, was responsible for the breach.[90][91]
System outages during the COVID-19 pandemic
On Monday, March 2, 2020, during theCOVID-19 pandemic, likely due to high trading volumes, Robinhood suffered a systemwide, all-day outage that prevented users from accessing the mobile app on a day when theS&P 500 climbed more than 4.6%.[92][93] Robinhood experienced shorter systemwide outages on March 3 and 9.[94] Robinhood offered compensation on a case-by-case basis.[95] In late June 2021, Robinhood was fined $57 million by theFinancial Industry Regulatory Authority (FINRA) and was ordered to pay $13 million in restitution to clients affected by outages and misleading communications in March 2020 in the largest penalty ever issued by the agency.[96] In March 2023, the company agreed to pay $10 million to settleclass action lawsuits regarding trading losses due to the outages.[97][98][99]
Suicide of Alexander E. Kearns
"Alex Kearns" redirects here. For the photographer, seeAlex Cearns.
In June 2020, 20-year oldUniversity of Nebraska–Lincoln student Alexander E. Kearns committed suicide after seeing a negative cash balance of $730,000 in his Robinhood account after the expiration, exercise, and assignment of options positions, likely abull spread. It was later discovered that this balance was not complete as it did not reflect settlement of an offsetting position.[100] In his suicide note, Kearns accused Robinhood of allowing him to take too much risk.[101] The company also was criticized for not responding timely to inquiries by Kearns about the negative balance. Robinhood then began offering additional guidance and requiring additional criteria and education for customers seeking authorization to trade options.[102][103][104][105] Kearns' family filed and later settled awrongful death claim.[106]
Regulatory issues
In August 2022, Robinhood's cryptocurrency division was fined $30 million by theNew York State Department of Financial Services for allegedly violating anti-money-laundering and cybersecurity regulations, in the department's first cryptocurrency-related enforcement action.[107]
On December 16, 2020, the Securities Division of theMassachusetts Secretary of the Commonwealth filed an administrative complaint alleging violation of state securities laws by "marketing itself to Massachusetts investors without regard for the best interests of its customers and failing to maintain the infrastructures and procedures necessary to meet the demands of its rapidly growing customer base" and that Robinhood exploits novice investors withgamification.[108][109] In March 2022, in a win for Robinhood, the Suffolk County Superior Court declared that the new fiduciary duty rule underlying parts of the case was invalid.[110] In February 2024, the company paid $7.5 million and agreed to overhaul its digital engagement practices to settle the remaining claims.[111]
Robinhood received aWells notice from theU.S. Securities and Exchange Commission in May 2024 alleging that the company had violated securities laws over crypto tokens traded on its platform; Robinhood countered that cryptocurrencies are not securities and are not covered by securities laws.[112]
In September 2024, Robinhood paid $3.9 million and instituted changes to settle claims by the State of California that, between 2018 and 2022, customers could not make timely withdrawals of cryptocurrency from their Robinhood accounts to cryptocurrency wallets.[113][114]
In March 2025, theFinancial Industry Regulatory Authority imposed a $26 million penalty on Robinhood Financial and Robinhood Securities for violating numerous FINRA rules, including failing to establish and implement adequate anti-money laundering programs, which led to the firms’ inability to detect, investigate, or report suspicious activities such as manipulative trading, suspicious money movements, and cases of third-party account takeovers.[115] Robinhood Financial was also ordered to pay $3.75 million in restitution to certain customers whose market orders were restricted and canceled, leading them to re-enter their orders and receive executions at a less favorable price.[115]
On January 28, 2021, several stockbrokers, including Robinhood, restricted the trading of certain stocks, most notablyGameStop, to meet collateral requirements at itsclearing house, theNational Securities Clearing Corporation, following an effort by users of ther/wallstreetbets subreddit to drive up share prices.[116][117][118] Robinhood faced an increase in its collateral requirement from $700 million to $3.7 billion, later reduced to $1.4 billion, and the inability to meet this requirement may have resulted in insolvency in a matter similar to thebankruptcy of Lehman Brothers. Robinhood was able to quickly raise funds to meet the reduced requirements.[119][120] The company began once again allowing trading in the affected stocks on January 29.[121]
Following the controversy, the Robinhood mobile app wasreview bombed on theGoogle Playapp store.[128] Google deleted at least 100,000 such reviews, calling them "coordinated or inorganic".[129][130] However, after additional negative reviews on the app that resulted in a 1.1-star rating, Google confirmed that the new reviews do not violate Google policies and will not be removed.[131]
On January 28, 2021, aclass-action lawsuit against Robinhood was filed in theSouthern District of New York allegingmarket manipulation and collusion withmarket makerCitadel Securities to deprive investors of the ability to invest in the open market in violation of Section 1 of theSherman Antitrust Act, which prohibits agreements in restraint of trade.[133][134] The case was dismissed by the Miami federal court in November 2021 on the grounds that the plaintiffs fell short of providing direct evidence of an antitrust conspiracy and that itsterms of service allowed the company to prohibit trading by customers.[135] In 2024, an appeals court affirmed the dismissal of the case.[136]
US$2.95 billion (2024)
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