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Robinhood Markets (NasdaqGS:HOOD) is expanding beyond trading with new product rollouts, including a move into prediction markets.
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The company has acquired a majority stake in MIAXdx, a derivatives exchange, as part of this broader push.
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Robinhood is also launching its Ethereum Layer 2 network, called Robinhood Chain, to support on chain activity tied to its platform.
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These moves come while Robinhood manages a challenging crypto backdrop and a transition in its chief financial officer role.
For you as an investor, Robinhood is no longer just the zero commission brokerage that popularized app based trading. Its push into prediction markets and on chain infrastructure sits alongside its existing stocks, options, and crypto trading lines at a time when crypto related revenues can be unpredictable. The MIAXdx stake shifts part of its footprint further into derivatives market infrastructure, which is structurally different from its core retail brokerage business.
Viewed together, these steps indicate that Robinhood is testing new ways to broaden where and how it participates in trading and crypto ecosystems, rather than relying only on transaction volumes in its app. The CFO transition adds an extra layer for you to watch regarding how the company prioritizes investment, risk controls, and capital allocation as this broader model develops.
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📰 Beyond the headline: 2 risks and 2 things going right for Robinhood Markets that every investor should see.
For you, the MIAXdx deal and Robinhood Chain test launch sit against the backdrop of a business that is already generating sizeable earnings and cash. In 2025, Robinhood reported full year revenue of US$4.473b and net income of US$1.883b, with basic EPS from continuing operations of US$2.12. That gives the company room to fund product build out while it absorbs short term pressure from a weaker Q4, where revenue of US$1.283b and net income of US$605m fell short of some expectations and crypto transaction revenue declined 38%. The completed US$909.51m buyback since May 2024 also shows capital being returned even as new initiatives are rolled out.
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The push into MIAXdx, prediction markets, and Robinhood Chain lines up with the narrative that product expansion beyond core brokerage and into tokenized assets can support more diversified, recurring revenue streams.
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At the same time, softer Q4 transaction metrics, lower take rates in options and crypto, and a 13% drop in monthly active users challenge assumptions that user activity and revenue per user will keep scaling without hiccups.
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The specific economics of running an Ethereum Layer 2 and controlling a derivatives exchange, including potential compliance and technology costs, are not fully addressed in the narrative and could influence future margin outcomes.
