Robinhood Plans To Launch Stablecoin To Compete With Tether
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Robinhood is now thinking about introducing stablecoins, according to a report. However, a spokesperson for Robinhood noted that the company has no immediate plans to roll out this offering, but it did not deny the report.
Robinhood started as a disruptor in the US stock market but has now added cryptocurrency services and makes a lot of its money from digital assets. Its revenue from crypto transactions reached $81 million in Q2 2024, while the total revenue from transactions was $327 million.
The Robinhood’s Stablecoin Strategy Intends To Rival Tether
Robinhood has been providing cryptocurrencies to users in the US for years and entered Europe last December. It also increased its European cryptocurrency services by introducing staking and making the app available in several local languages.
The recent report revealed that the firm’s plans for stablecoins aim to compete with Tether and cover the gap after the Markets in Crypto-Assets Regulation (MiCA) was introduced in the European Union.
The first part of MiCA started earlier this year and added some rules for stablecoins in the EU. Several crypto companies in the area had to remove some stablecoins that did not follow local laws.
Stablecoins are different from Bitcoin and other changing cryptocurrencies. They are digital currencies linked to traditional currencies or other assets, which makes them stable. While many banks often resist using cryptocurrencies, many have accepted stablecoins because they are helpful for transactions.
Tether leads the $170 billion stablecoin market, but it is losing its control. Tether’s market value is around $120 billion, while the second-biggest stablecoin, USDC, has exceeded $36 billion. In August, PayPal’s stablecoin, introduced in 2024, reached over $1 billion in circulation but has fallen by 30 percent since then, according to reports.
Revolut Is Also Exploring The Stablecoin Market
Revolut is also said to be moving into the stablecoin market, but the firm has not made an official statement yet. A spokesperson from Revolut revealed that the company will continue to grow its crypto offerings but did not clarify if that includes stablecoins.
A month ago, Robinhood Markets reportedly replied to a Wells Notice from the Securities and Exchange Commission (SEC) it got in May. The regulator warned the firm of possible enforcement action regarding its crypto business.
Vlad Tenev, the Chief Executive Officer of Robinhood, said this during an interview on August 8. He stated that the team has put in a lot of effort to ensure that the response is as good as it can be.
