Robinhood’s (HOOD) document crypto buying and selling income from the final quarter of 2024 could show exhausting to repeat, based on JPMorgan analyst Kenneth Worthington, who forecast a drop in digital asset volumes for the primary quarter of this yr.
The net buying and selling platform reviews first quarter outcomes after the U.S. market shut on Wednesday.
The fourth quarter’s staggering 700% surge in cryptocurrency buying and selling income was behind a large soar in HOOD’s total transaction-based income. Worthington, nevertheless, sees that momentum stalling within the first quarter, citing a decline in each fairness and crypto markets, particularly within the latter half of the quarter.
Worthington and group estimate Robinhood customers traded about $52 billion in crypto through the quarter, down from $71 billion in This autumn. Worthington attributes the drop to a “risk-off” surroundings that erased a lot of the market’s features because the begin of the yr. Robinhood’s property below custody (AUC) are anticipated to fall 5% from the prior quarter to $183.3 billion, although nonetheless up 41% year-over-year.
Whereas the report highlights sturdy retail shopping for in early April following tariff-related information from Washington, Worthington means that exercise might not be sufficient to elevate first quarter outcomes. He warns that softer demand for margin and derivatives buying and selling — additionally seen at competitor Interactive Brokers — may weigh on Robinhood’s total efficiency.
Worthington maintained a impartial score on the inventory and trimmed his value goal by $1 to $44, suggesting about 10% draw back from the present value just under $49.
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