Robinhood (NASDAQ:HOOD) not too long ago acquired a Wells Discover from the Securities and Trade Fee, which was sudden given the corporate’s conservative method to cryptocurrency listings, based on a KBW analysis report launched on Monday.
KBW highlighted that Robinhood presents a comparatively modest collection of fifteen cryptocurrencies on its U.S. platform, in distinction to some rivals who listing over 2 hundred digital belongings. Analysts led by Kyle Voigt consider that Robinhood’s crypto operations within the U.S. will stay unchanged, and so they anticipate the SEC will probably 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 lots of its U.S. friends, ought to they face comparable 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 particular group of digital belongings provided on the platform. From a income danger standpoint, probably the most crucial situation could 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 ranking on Robinhood’s inventory with a goal worth of $20. Following the information, Robinhood’s shares noticed a slight enhance, buying and selling up by 1.3% early Tuesday, at round $18.
In line with KBW, Robinhood shareholders could not obtain a definitive decision on the potential authorized case till late 2025 on the earliest, drawing parallels to the continued regulatory proceedings towards Coinbase (NASDAQ:COIN).
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