Robinhood (NASDAQ:HOOD) just lately acquired a Wells Discover from the Securities and Change Fee, which was sudden given the corporate’s conservative method to cryptocurrency listings, in accordance with a KBW analysis report launched on Monday.
KBW highlighted that Robinhood provides a comparatively modest choice of fifteen cryptocurrencies on its U.S. platform, in distinction to some rivals who record over 200 digital property. Analysts led by Kyle Voigt imagine that Robinhood’s crypto operations within the U.S. will stay unchanged, they usually anticipate the SEC will seemingly file a lawsuit within the coming months.
“Our preliminary evaluation means that Robinhood would decide to contest the SEC in courtroom and stands a greater probability of prevailing than a lot of its U.S. friends, ought to they face related challenges. That is due partly to Robinhood’s stringent itemizing standards,” the KBW report acknowledged.
Cryptocurrency buying and selling accounts for 12% of Robinhood’s complete income. KBW speculates that the SEC’s focus is perhaps on a selected group of digital property supplied on the platform. From a income threat standpoint, probably the most essential situation can be if the SEC decides to categorise Ethereum as a safety, because it represents roughly 25% of Robinhood’s crypto buying and selling quantity.
The brokerage maintains a market carry out score on Robinhood’s inventory with a goal value of $20. Following the information, Robinhood’s shares noticed a slight improve, buying and selling up by 1.3% early Tuesday, at round $18.
In accordance with KBW, Robinhood shareholders might not obtain a definitive decision on the potential authorized case till late 2025 on the earliest, drawing parallels to the continuing regulatory proceedings towards Coinbase (NASDAQ:COIN).
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