Crypto Exchange FTX Is Considering Acquiring Robinhood

Cryptocurrency derivatives exchange FTX is reportedly exploring the acquisition of Robinhood Markets, the popular trading app that introduced millions of traders to Bitcoin (BTC), Ethereum (ETH) and Dogecoin ( DOGE).

Bloomberg reported on Monday, citing people familiar with the matter, that FTX is conducting internal deliberations on whether to acquire Robinhood. While no decision has been made to make an acquisition, FTX is said to be taking the matter seriously. Bloomberg’s contacts clarified that FTX has not made an acquisition offer to Robinhood and it may still decide not to pursue a deal.

In a follow-up statement to Bloomberg, FTX CEO Sam Bankman-Fried clarified that his company was excited about a potential partnership with Robinhood but had no active merger conversations, consistent with previous reports:

"We're excited about Robinhood's commercial prospects and the potential ways we can partner with them [...] Having said that, we have no active M&A conversations with Robinhood."

This isn't the first time FTX or Bankman-Fried has been linked to Robinhood. In May, it was revealed that the FTX CEO had acquired a 7.6% stake in the discount brokerage for $650 million. At the time, Bankman-Fried said the acquisition reflected his view of Robinhood as an "attractive investment," but that he had no intention of changing or affecting control of the company.

Despite the onset of crypto winter, FTX shows no signs of slowing down its expansion. FTX recently provided a $250 million bailout proposal to bitcoin lender BlockFi; earlier this month, FTX signed an agreement to acquire Canadian cryptocurrency platform Bitvo for an undisclosed sum.

FTX confirmed earlier this month that it would not be laying off staff amid mass layoffs in its cryptocurrency trading business. Bankman-Fried tweeted on June 6 that his exchange plans to “maintain growth” for the foreseeable future.

As for Robinhood, the discount brokerage platform has lost about three-quarters of its value since listing on the Nasdaq stock exchange in July 2021. The company's shares rose 13 percent on Monday, but are still down more than 75 percent from its IPO.

In the first quarter of 2022, Robinhood's net income fell 43% year-over-year to $299 million. Revenue related to cryptocurrencies fell 39% to $54 million during the same period.

This article has been updated to include the latest comment from Sam Bankman-Fried.