26 Facts About Robinhood Markets

Robinhood Markets, Inc is an American financial services company headquartered in Menlo Park, California, that facilitates commission-free trades of stocks, exchange-traded funds and cryptocurrencies via a mobile app introduced in March 2015.

Robinhood Markets was founded in April 2013 by Vladimir Tenev and Baiju Bhatt, who had previously built high-frequency trading platforms for financial institutions in New York City.

In February 2016, Robinhood Markets introduced instant deposits, crediting users instantly for deposits up to $1,000; previously, funds took three days to appear via ACH transfer.

Robinhood Markets has prohibited its users from purchasing some high-risk penny stocks, such as banning purchases of Helios and Matheson Analytics, the owner of MoviePass, in August 2018.

In March 2022, Robinhood Markets announced it was adding four additional hours to extended trading for clients.

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In May 2022, Robinhood Markets announced the launch of a stock lending program, allowing users to give Robinhood Markets permission to lend out any fully paid stocks in their portfolio.

On January 25,2018, Robinhood Markets announced a waitlist for commission-free cryptocurrency trading.

Robinhood Markets began offering trading of Bitcoin and Ethereum to users in California, Massachusetts, Missouri, and Montana in February 2018.

In May 2018, Robinhood Markets expanded its trading platform to Wisconsin and New Mexico.

Robinhood Markets later added trading for Bitcoin Cash, Dogecoin, Ethereum Classic and Litecoin.

In June 2018, it was reported that Robinhood Markets was in talks to obtain a US banking license, with a spokesperson from the company claiming the company was in "constructive" talks with the US OCC.

In December 2018, Robinhood Markets announced checking and savings accounts, with debit cards issued by Ohio-based Sutton Bank would be available in early 2019.

Robinhood Markets initially claimed the accounts would be SIPC insured, which the SIPC denied.

In March 2022, Robinhood Markets launched the Robinhood Markets Cash Card, a debit card that allows users to automatically invest in assets like stocks and crypto when spending money.

Bloomberg News reported in October 2018 that Robinhood Markets had received almost half of its revenue from payment for order flow.

Robinhood Markets later confirmed this on its corporate website when asked by CNBC.

The Wall Street Journal found that Robinhood Markets "appears to be taking more cash for orders than rivals, " by up to a 60-to-1 ratio, according to its regulatory filings.

Robinhood Markets was sued in a class-action law suit in December 2020 for failing to disclose that a large portion of its revenue relied on payment for order flow.

In July 2019, Robinhood Markets admitted to storing customer passwords in cleartext and in readable form across their internal systems, according to emails it sent to the affected customers.

Robinhood Markets declined to say how many customers were affected by the error and claims that it did not find any evidence of abuse.

However, in 2020, the firm acknowledged that almost 2,000 Robinhood Markets accounts were compromised in the hack and that the hackers had siphoned off customer funds — a sign that the attacks were more widespread than was previously known, and not forthcoming originally by Robinhood.

On Monday, March 2,2020, Robinhood Markets suffered a systemwide, all-day outage during the largest daily point gain in the Dow Jones' history, preventing users from performing most actions on the platform, including opening and closing positions.

Robinhood Markets users postulated that the outage was the result of a coding error regarding leap year handling for Saturday, February 29,2020.

Robinhood Markets said that they will offer compensation on a case-by-case basis.

Robinhood Markets is currently facing three lawsuits due to outages in March 2020.

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Robinhood Markets restricted trading in these stocks in order to meet collateral requirements at their clearinghouse, the National Securities Clearing Corporation.