Robinhood’s earnings report just exposed the ugly truth about U.S. retail investors. The stock plunged 10% in premarket trading—and it was fully deserved.
On the surface, revenue hit a quarterly record of $1.424 billion, up 12%. But look at the profits and the picture changes: net income fell 14% year over year, and earnings per share came in below expectations. The biggest blow was crypto trading revenue, which plunged 55% year over year to just $120 million.
What does that tell us? Retail traders have basically checked out, and there’s no fresh money flowing into the market. Bitcoin is struggling to hold the $80,000 mark, trading activity is painfully subdued, and these figures tell the story better than anything else.
So how did revenue hold up? Event contracts—prediction markets. Revenue from that segment reached $173 million, 6.4 times what it was a year ago. When one door closes, another opens: retail traders have stopped trading crypto and flocked to betting on elections and sports. But the margins on this new business clearly can’t match crypto, dragging down overall profits.
This matters a lot for our markets. Robinhood is a barometer of retail sentiment worldwide. The plunge in crypto revenue confirms that the market is extremely short on cash, with no new wave of retail traders coming in. Without fresh money, dreaming of Bitcoin taking off on its own is just wishful thinking.
The Fed decision is also looming tonight, so macro risks are extremely high. My strategy is clear: keep a close eye on the $80,000 level. If Bitcoin breaks below it on strong volume, follow the move and go short; if it holds on low volume, cautiously test the waters with a small position. Don’t get carried away. If you’re sitting on profits, take them off the table—cash is king. Let’s get through this cash-starved stretch and wait for retail sentiment to recover.$HOOD
On the surface, revenue hit a quarterly record of $1.424 billion, up 12%. But look at the profits and the picture changes: net income fell 14% year over year, and earnings per share came in below expectations. The biggest blow was crypto trading revenue, which plunged 55% year over year to just $120 million.
What does that tell us? Retail traders have basically checked out, and there’s no fresh money flowing into the market. Bitcoin is struggling to hold the $80,000 mark, trading activity is painfully subdued, and these figures tell the story better than anything else.
So how did revenue hold up? Event contracts—prediction markets. Revenue from that segment reached $173 million, 6.4 times what it was a year ago. When one door closes, another opens: retail traders have stopped trading crypto and flocked to betting on elections and sports. But the margins on this new business clearly can’t match crypto, dragging down overall profits.
This matters a lot for our markets. Robinhood is a barometer of retail sentiment worldwide. The plunge in crypto revenue confirms that the market is extremely short on cash, with no new wave of retail traders coming in. Without fresh money, dreaming of Bitcoin taking off on its own is just wishful thinking.
The Fed decision is also looming tonight, so macro risks are extremely high. My strategy is clear: keep a close eye on the $80,000 level. If Bitcoin breaks below it on strong volume, follow the move and go short; if it holds on low volume, cautiously test the waters with a small position. Don’t get carried away. If you’re sitting on profits, take them off the table—cash is king. Let’s get through this cash-starved stretch and wait for retail sentiment to recover.$HOOD