Crypto-Friendly App Robinhood Now Has More Users Than E*Trade

Robinhood continues to garner investment funds and user interest, thanks to its commission-free model, the addition of cryptocurrencies, and its ability to attract millennials away from traditional trading platforms.

‘Quite Remarkable’

The free trading app Robinhood is now valued at $5.6 billion, following the company’s announcement that it has successfully closed its Series D round of funding with $363 million.

Some of the new investors forking over the bulk of those funds included Sequoia, Google’s Capital G venture capital fund, and Iconiq. However, DST Global invested the lion’s share during the Series D round. Last year, when Robinhood had two million users, DST Global facilitated the $110 million round.

Robinhood, which offers stocks and options trading without commission fees, currently boasts four million users — 0.3 million more than the online trading giant E*Trade. Noted Dan Primack, business editor of Axios:

E*Trade has been around since the original dot-com boom and is kind of considered the industry standard of online brokerages. The fact that Robinhood has been able to outpace them in terms of users in such a short period of time, I think is quite remarkable.

Explosive Growth for Robinhood

The app’s impressive growth is due in no small part to its addition of Bitcoin and Ethereum trading in April. The cryptocurrencies are available to buy or sell in 10 US states. Explained Robinhood’s co-founder and co-CEO, Baiju Bhatt, in a phone interview with CNBC:

Crypto has certainly added to our growth. In the next couple of years, I think you’ll see Robinhood looking like a full-service consumer finance company.

As noted by CNBC, Robinhood has managed to garner the attention of the much sought after millennial demographic (ages 18-35), which traditional financial trading platforms have struggled to attract in recent years. Drawing in the younger crowd of investors is the app’s commission-free trading model and the addition of cryptocurrencies. Explained Bhatt:

I think the rate at which more traditional tech companies are disrupting finance is interesting to see. As it stands we’re leading the pack, we’re excited about accelerating that.

What do you think about the early success for the commission-free app? Are you surprised to learn that the relative newcomer has more users than E*Trade? Let us know in the comments below!

Images courtesy of Bitcoinist archives and Wikimedia Commons/@Nilfanion.