Robinhood said it acquired Cove Markets on Tuesday. Robinhood, the American broker, says the acquisition will put more control into the hands of its investors. Investors can now manage assets directly from their cryptocurrency profiles.
Robinhood released this information in a press release on their website. The partnership will see both companies sharing a common objective of simplifying cryptocurrency investments. Also, lower fees will result from the partnership where users can further enjoy the benefits of transacting digital currencies compared to fiat.
Cove Markets Founders Offer Support
Scott Knudsen, one of the co-founders of the Cove Markets, says their team will join forces with the crypto unit under Robinhood. This integration is part of the acquisition terms. No one knows the figures the acquisition cost Robinhood.
Christine Brown, COO at Robinhood, believes that the new acquisition will increase crypto trading on its platform. This comment denotes the strategic acquisition deal with the startup intended to turn the broker into a platform where digital currencies will be traded. The Chief Operating Officer thinks the acquisition will also strengthen the leadership of Robinhood, looking at the experience the team at Cove Markets brings to Robinhood Crypto.
Acquisition Will Foster Crypto Trading
She believes their combined experience in trading, especially with executing the trade, will become helpful in the industry from now on. Also, their expertise in building infrastructure for the crypto market comes in handy to assist Robinhood Crypto in creating market-altering trading tools.
She thinks the acquisition is generally good for the crypto market, stressing that it fosters competition. Users are particularly delighted in the recent addition because a better customer experience results from such a partnership.
Cove Markets is a new startup. It was founded in 2018. The startup focused on creating tools to assist crypto investors in managing accounts. The startup runs a cross-market service where its products are maintained across other exchanges.
Further Development Of The Crypto Market
Scott is delighted that the partnership with Robinhood will foster the crypto market’s development. He believes both organizations will create and design world-class products for users looking to improve their cryptocurrency trading.
Robinhood, the broker service, dived into cryptocurrency investment in 2018. Users and investors on the platform were not permitted to manage crypto assets. Neither were they allowed to transfer them as obtained on crypto exchanges. That is changing as the company is working on its native wallet for crypto.
Robinhood’s customer base reaching millions had responded to the news of the acquisition with glee and happiness. The positive sentiment had contributed to the increase in crypto trading in the form of meme tokens. Early in the year, meme tokens became popular on Robinhood. The popularity of meme tokens on the platform resulted from its listing. In the United States, Robinhood was the only known exchange that listed the meme tokens on its platform at the time.
The team at Robinhood has all the reasons to smile because they managed to pull in massive revenue from transactions alone. They pulled in half of the income, which was based on dealing in the second quarter of 2021 directly from crypto trading. As soon as meme tokens entered the bear season and the demand for them waned, revenue going to Robinhood also stopped.