According to Bloomberg, a popular cryptocurrency exchange, FTX is looking at ways to acquire Robinhood. Robinhood is a popular trading platform in the United States.
The platform offers its users access to the crypto and stock market. If FTX successfully acquires the firm, it will help to expand its user base.
Bloomberg: FTX To Buy Robinhood
Also, Bloomberg stated that FTX has not made a formal appeal to the brokerage platform. The firm may likely have a rethink and change its mind. FTX is only exploring the option.
However, FTX has been of great help during the ongoing crypto market crisis. The company has played a massive role in providing such firms with a bailout option.
Recently, there has been a massive decline in the crypto market. This has pushed several firms into liquidation. Popular firms such as Celsius had to pause withdrawal options on the platform.
Also, the fall of Terra has affected companies with exposure to the DeFi platform. Several users and companies have lost millions of dollars. An example of such a company is Global Digital.
Another investment firm, 3AC (Three Arrows Capital), also faced liquidation issues and had to borrow funds. This has affected companies connected to the investment firm.
Also, the United States Reserve increased its interest rate recently. All these activities have affected several firms in the crypto space. Some of them have sought assistance from the FTX exchange.
Currently, the FTX exchange is ready to buy shares in two lending companies, Voyager and BlockFi. According to Bitcoinist, BlockFi investors are trying to raise $250 million.
The investors want to use this fund to counter the offer of FTX. This will ensure their stake in the firm is preserved. Meanwhile, Sam Bankman-Fried, CEO of FTX has not responded to the report.
Crypto Community Reacts To Possibility Of FTX Buying Robinhood
According to most market participants, FTX is taking giant strides in the United States market. In 2021, Robinhood had a user base of over 30 million with $1.8 billion in revenue.
Also, Robinhood’s total assets are worth about $20 billion. If FTX purchased the firm, it would help it compete with Coinbase.
Coinbase is currently a dominant crypto exchange in the United States market. According to Blockware Solutions’ Analyst, Will Clemente:
“This is a great move by Sam Bankman-Fried to compete for US retail investors. Coinbase is currently dominating this sector while FTX has more of sophisticated investors. To me, this will be a competitive move by FTX.”
The crypto community is waiting to see if FTX will make a formal offer. As of writing time, the shares of Robinhood have jumped from below $8 to over $12.