Robinhood is a start-up trading platform that has gotten a lot of attention from investors and the financial community. They have been in business for five years and raised $176 million in venture capital.
Robinhood has previously been focused on trading stocks and ETFs but they are now moving into cryptocurrency trading with their “Crypto, 24/7” platform. This will now allow their users to buy and sell Bitcoin and Ethereum with no transaction fees as well as let users track 14 other top coins.
There are always costs inherent with doing financial transactions so Robinhood is “planning to operate this business on a break-even basis and [they] don’t plan to profit from it for the foreseeable future.” Standard trading platforms like Scottrade or E*Trade charge a fee of around $6 per trade in order to cover their marketing and retail footprint costs. Robinhood doesn’t have any of that which is how they are able to offer their services for so cheap.