Robinhood (HOOD) Gains Momentum Amid Diversified Growth and Reduced Crypto Dependency

Original | Odaily Planet Daily (@OdailyChina)

Author | Azuma (@azuma_eth)

Robinhood (HOOD) has recently shown strong price performance, briefly reclaiming the $100 level last night, though it failed to close above it. I remain optimistic about HOOD’s future prospects.

During this downturn cycle, HOOD has been one of the few assets I’ve consistently accumulated (including through rollovers), which is why I’ve long wanted to write an article about it. In a previous episode of Odaily Tea Talk, I briefly shared my rationale for building the position; today, I’d like to take advantage of the stock’s positive momentum to delve deeper. I want to clarify that this is not investment advice, nor does it represent the platform’s views—it’s simply my personal thinking behind accumulating HOOD.

You can find many positive explanations for HOOD's recent price increase across various dimensions.

First, let’s look at the fundamentals: Robinhood last week released its operational data for May, as detailed below.

• Total Assets: $377 billion, a record high;
• Number of funded accounts: 27.7 million, a new all-time high;
• Margin balance: $19.5 billion, a record high;
• Event Contracts trading volume: 3.9 billion, a new all-time high;
• Cash & Deposits: $18.6 billion, a record high;
• Options ADV: 11.6 million contracts, tying the all-time high;
• Equity Volume: $315 billion, the second-highest in history;
• Options Contracts trading volume: 231 million, the second-highest in history;
• The only weak metric is cryptocurrency volume: $12.2 billion, ranking only 16th in monthly historical data...

Some positive factors on the news front may better stir investor sentiment.

• In the fastest-growing segment of prediction markets, Robinhood has begun diverting traffic from Kalshi by launching its own prediction market, Rothera, and is expected to no longer share related revenues with Kalshi. For more details, see our report published yesterday: The First Stock in the Prediction Market Concept Has Emerged!
• Second, the IPO arena: SpaceX’s historic IPO brought record-level traffic to Robinhood. More importantly, Robinhood Securities, Robinhood’s brokerage and clearing division, was approved last week to serve as an IPO underwriter, positioning Robinhood to play a more central role in future IPO activities, such as those of Anthropic and OpenAI.
• Robinhood has also been selected by the U.S. Department of the Treasury to serve as the broker and initial trustee for the "Trump Account." The "Trump Account" is a tax-deferred investment account program established by President Trump on June 9, 2025, under the authority of the "Big and Beautiful" Act, designed to create government-funded savings accounts for American citizens born between January 1, 2025, and January 1, 2029. This means that over the coming years, millions of newborn American children will automatically use Robinhood as their brokerage platform. For more details, see "Robinhood Gains a New Wave of Investors, the Oldest Being 1, the Youngest -3".

In terms of market trends, there are some more direct signals.

• Robinhood director Meyer Malka has been steadily increasing his holdings of HOOD. Over the past one to two weeks, Malka has accumulated more than $50 million worth of HOOD.
• Institutional analysts have also raised more positive price expectations for HOOD. Goldman Sachs maintains a “Buy” rating and has raised its target price from $105 to $108; Mizuhi has set a target price of $115; Piper Sandler is the most optimistic, with a target price of $135.

Personally, my initial reason for building a position in HOOD was optimism about its Q2 earnings performance: first, I anticipated a significant surge in stock trading-related revenue amid the anticipated epic rally in U.S. equities; second, I expected a sharp increase in trading volume on the prediction market due to the World Cup, along with the revenue-capturing effect of Rothera.

However, the reason for subsequently moving a significant portion of the position (primarily residual crypto assets) to HOOD is a different logic—and this is what this article truly aims to explain.

In early May, a friend asked me what I had bought recently, and I mentioned HOOD. At that time, HOOD had dropped from above $90 due to its disappointing Q1 earnings report, which included an unexpected $100 million expense related to the "Trump account," and its short-term price action looked quite poor.

My friend asked me why, and I briefly explained the reasons above. He thought for a moment and said it was a shame that all his positions were underwater and he had no capital left. I asked him what he was holding, and as expected, it was mostly altcoins.

I told him at the time: “Instead of clinging to altcoins, just switch directly to HOOD.”

The context for this assessment is that, over a prolonged period, cryptocurrency-related revenue has been a significant component of Robinhood’s total revenue, and HOOD’s stock price has shown a strong correlation with cryptocurrency markets. However, recent indicators suggest that Robinhood is beginning to move beyond its dependence on cryptocurrency business and is positively distancing itself from this correlation.

First, let’s examine Robinhood’s cryptocurrency-related revenue over the past five quarters. It’s clear that the proportion of this revenue has been trending downward, with Q1 reaching its lowest level since 2025.

• In Q1 2025, total revenue was $927 million, with cryptocurrency-related revenue at $329 million, accounting for 35%.
• In Q2 2025, total revenue was $989 million, with cryptocurrency-related revenue at $160 million, accounting for 16%.
• In Q3 2025, total revenue was $1.274 billion, with cryptocurrency-related revenue at $268 million, accounting for 21%;
• In Q4 2025, total revenue was $1.283 billion, with cryptocurrency-related revenue at $221 million, accounting for 17%;
• In Q1 2026, total revenue was $1.067 billion, with cryptocurrency-related revenue at $134 million, accounting for 13%.

Now let’s look at a visual comparison of HOOD and BTC price movements: since the beginning of the year, HOOD has largely followed a similar trend to BTC, but recently a clear divergence has emerged.

The emphasis on these two points is primarily to illustrate that the valuation logic surrounding HOOD has begun to shift. In the past, HOOD was often regarded as a “shadow stock” of the crypto market, with its business performance exhibiting clear cyclical patterns tied to crypto bull and bear markets—when crypto prices surged, retail investors flooded Robinhood to trade altcoins aggressively, driving up fee revenue and propelling the stock price higher; when the crypto market declined, retail investors withdrew, and Robinhood’s revenue quickly plummeted.

But today, Robinhood no longer relies as heavily on its cryptocurrency business. Even if the crypto market remains in its current sluggish state, its stock trading, prediction markets, Pre-IPO services, and newly added underwriting business are still expected to drive its revenue growth.

This does not mean the cryptocurrency market will no longer impact HOOD. On the contrary, if the crypto market re-enters a bull phase in the future, Robinhood’s cryptocurrency trading revenue is likely to surge in tandem, allowing HOOD to continue benefiting from industry growth.

In simpler terms, the crypto market still influences HOOD, but HOOD no longer depends on it—if crypto enters a bull market, HOOD will likely rise with it; if crypto stays sluggish, HOOD won’t be affected much.

For those still hopeful about altcoins but increasingly concerned about liquidity depletion, narrative fatigue, and value capture issues, HOOD may now offer a higher margin of safety than continuing to pin hopes on tokens waiting for an uncertain next narrative.