Robinhood opens UK brokerage services in first international expansion

Today marked the launch of Robinhood‘s previously announced brokerage services in the UK. The launch represents Robinhood’s first expansion beyond the U.S.

In its announcement, the company said UK customers will have access to over 6,000 U.S.-listed stocks and American Depository Receipts (ADRs) at launch. Features will include commission-free trading, high-yield interest on uninvested cash, extended market hours, and fee-free currency conversion between GBP and USD.

Robinhood aims to spark higher retail investment internationally as it did in the U.S. after pioneering its zero-commission, no-minimum-balance brokerage model in 2013. The company claims this innovation has, to date, saved its users billions in fees and helped boost U.S. household equity ownership by 27% between 2013-2022.

The international push comes even as Robinhood’s revenue has recently declined. In Q3 2023, transaction-based revenue fell 55% year-over-year, possibly owed in part to crypto bear market conditions.

Robinhood’s position

In addition to the UK brokerage, Robinhood has revealed ambitions to offer cryptocurrency trading in the EU pending regulatory approval. The company currently holds over $3 billion worth of Bitcoin to custody user crypto balances in cold storage. Research shows Robinhood also owns the 5th largest Ethereum wallet, with over $2.5 billion in holdings.

Cryptocurrencies made up 12% of Robinhood’s transaction revenue in Q3 2023, down from 24% in Q3 2022. However, crypto exchange expansion still features prominently in management’s growth forecasts as customer balances continue rising despite market volatility.

Robinhood also faces macroeconomic challenges that may impact its global ambitions, including high inflation, rising interest rates, and tightening disposable income.

Meanwhile, early Robinhood investor Alphabet Inc. liquidated the last of the 612,214 Robinhood shares it previously held as of August. The tech giant began incrementally reducing its stake as Robinhood’s falling transaction volumes posed headwinds.

The path forward remains complex as Robinhood navigates first-time expansion into the UK and other targeted markets against this economic backdrop.