Per a Bloomberg report, crypto exchange FTX is currently looking into ways to purchase Robinhood (HOOD), the U.S. trading platform that offers its clients access to the stock and crypto market. The report quotes sources familiar with the initiative.
The crypto exchanges seem to be at a preliminary exploration on this subject, the report claims. In that sense, FTX is yet to make a formal offer to the U.S.-based brokerage platform.
As the crypto exchange is only exploring this option, Bloomberg claims, it could eventually decide against making a formal offer. The exchange has been making a lot of headlines recently due to its leadership role in providing crypto companies with a bailout.
The industry has been facing the consequences of the Terra collapse, companies with exposure to the failed investment firm Three Arrows Capital (3AC), and a shift in the U.S. Federal Reserve monetary policy. This has impacted companies in the space which has turned to FTX for financial assistance.
As of now, the crypto exchange is set to take a stake in lending companies BlockFi and Voyager. The latter gave Three Arrow Capital a $670 million loan. Today, Voyager issued a default notice to the investment firm.
So everyone is talking about @SBF_FTX $500M LOC to @investvoyager but did anyone notice that just before the announcement @AlamedaResearch acquired an additional 14.9M shares of Voyager? pic.twitter.com/z93iInNnoh
— Swanson (@ryan_swansonx) June 22, 2022
As Bitcoinist reported today, BlockFi investors have been attempting to raise over $250 million to counter FTX’s offer. This will provide shareholders with a controlling interest and preserve their stake in the company.
FTX To Buy Robinhood To Take Market Share Away From Coinbase?
The crypto community has been quick to react to this news. Most people in the industry agree that FTX is making a big push into the retail U.S. market.
Robinhood has over $20 billion in total assets and annual revenue of $1.8 billion with 31 million users as of 2021. This could help the company expand into a region and a sector dominated by its competitor, Coinbase.
In that sense Will Clemente, Lead Insights Analyst at Blockware Solutions, said:
This is an interesting move by SBF because to date Coinbase has dominated the retail investor base and FTX has dominated the more sophisticated investor base by being extremely regulatory friendly etc. This is SBF making a move on Coinbase in my opinion.
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Remains to be seen if the purchase will take place, or even if FTX will provide Robinhood with a formal offer. At the time of writing, HOOD’s shares seem to have positively reacted to the news, the stock was traducing below $8 before the Bloomberg report and jump to $12 after.