Robinhood Acquires Bitstamp in Unexpected $200 Million Cryptocurrency Exchange Deal

On Thursday, Robinhood disclosed the acquisition of Bitstamp, among the pioneering cryptocurrency exchanges on the global stage, through a deal consummated entirely in cash, estimated at approximately $200 million. Anticipated to be finalized within the first half of 2025, this move aligns with Robinhood’s strategic objectives to amplify its footprint in international markets.

Since its inception in Slovenia in 2011, before transitioning to Luxembourg and the U.K., Bitstamp has been a consistent entity in the crypto space. However, in recent times, its market share has seen a downward trend. Even with a customer base of four to five million, Bitstamp now sits at the 16th position in trading volume among its peers in the cryptocurrency exchanges realm. Europe continues to be its predominant market, supplemented by a clientele spread across the UK, Asia, and the U.S.

During an interview with Fortune, Johann Kerbrat, the General Manager of Robinhood Crypto, highlighted Bitstamp’s impressive portfolio of 50 global licenses, alongside its significant institutional trading operations. Kerbrat underscored the importance of this acquisition as a fundamental step toward one of Robinhood’s key goals, which includes creating an institutional business to further enhance its rapidly expanding consumer product lineup.

This acquisition, rather unexpected given no prior indication that Bitstamp was on the market, emerges as Robinhood is recuperating from a challenging 2023 that witnessed its stock plummet to as low as $7 from around the current price of $22. These setbacks led to speculation of Robinhood itself being a takeover target and were reflective of a broader skepticism about the financial technology industry’s robustness.

Robinhood’s narrative changed in 2024 with the announcement of a $1 billion stock buyback program following a record-breaking earnings report for the first quarter. Additionally, the company has commenced diversifying beyond volatile stock trading by integrating services like credit cards and retirement accounts that offer a stable revenue stream, less susceptible to market swings.

Simultaneous to Robinhood’s acquisition of Bitstamp is the significant surge in cryptocurrency markets, with Bitcoin’s value escalating over 60% since the year’s inception. This bullish market contributed to Robinhood’s crypto division tripling its revenue in the first quarter, as per Fortune.

With this acquisition, Robinhood stands to redefine its crypto dealings that are currently primarily dependent on external market makers for sourcing Bitcoin and other cryptocurrencies. Owning Bitstamp permits Robinhood to internally source cryptocurrencies, possibly even leading to an offer for its customers to engage in trading on the either-merged or newly-branded platform. Furthermore, Bitstamp’s current array of offerings includes up to 85 digital tokens in certain markets, significantly outpacing the selection by Robinhood, in addition to capabilities like lending and staking.

The potential expansion of Robinhood’s crypto services in the United States, however, may encounter regulatory challenges from the Securities and Exchange Commission, which had previously signaled its intention to pursue legal actions against the company concerning its token offerings. This aggressive stance toward the crypto industry by the SEC, termed by many as legally tenuous, comes amidst wider criticism of the commission’s perceived overreach.

As for Bitstamp’s future branding post-acquisition, Kerbrat stated that it is too early to speculate on whether it will continue under its current moniker or be rebranded. The closure of the deal is slated for the following year.

Preceding this acquisition by almost a year were reports that Bitstamp was considering a fundraising effort to expand in the U.K. and Asia, though at that time, CEO Jean-Baptiste Graftieaux indicated that selling the company was not on the agenda.

In the press release from Robinhood concerning the deal, Graftieaux reaffirmed commitment to providing an exceptional trading experience, emphasizing a sustained focus on compliance, security, and client-centric values as Bitstamp integrates into Robinhood’s ecosystem.

Barclays

Capital fulfilled the role of financial advisor for Robinhood, whereas Bitstamp received advisory services from Galaxy Digital Partners.