Robinhood crypto volumes dip in April, but Mizuho sees no cause for concern
Mizuho Securities remains positive on Robinhood’s crypto outlook despite a slowdown in April trading activity, citing rising take rates and sustained interest amid bitcoin’s recent gains.
Robinhood reported first-quarter earnings and revenue that beat analyst estimates on Wednesday. While cryptocurrency trading volume rose 28% year-over-year to $46 billion, this was a notable drop from a record-high of $70 billion in the fourth quarter of 2024.
The commission-free brokerage generated $141 billion in crypto trading volumes throughout 2024, driven by that huge surge in the fourth quarter amid the November presidential election and bitcoin's rise to $100,000.
Robinhood's management team said April generated about $8 billion in crypto volume, which was below the $15 billion monthly average from January to March.
Despite the drop, Mizuho Securities sees three main reasons to "stay constructive" on Robinhood's crypto prospects: April monthly activity is still above historical levels, take rates are moving up, and history shows volumes per funded account are rarely muted while BTC prices rise. For its part, the price of bitcoin rose 10% in April.
Chart courtesy of Mizuho Securities.
"We argue that 4Q24/1Q25 are abnormally high levels of crypto trading activity given the 'Trump Bump' that trickled through the period," Mizuho analysts led by Dan Dolev wrote in a note. "Take rates are moving up - and we believe they will continue that trajectory. For perspective, 1Q gross take rates were 57bps, up from 53bps in 4Q...and 37bps in 1H24."
Dolev said that Coinbase's retail take rate is nearly three times higher, which gives Robinhood ample upside potential to continue raising take rates.
Mizuho lowered its second-quarter crypto volume estimates from $35 billion to $32 billion. The firm maintains its "outperform" rating on HOOD shares but lowered its price target from $80 to $65.
Robinhood's stock traded higher by 5.7% to $49.37 at publication time, according to The Block's HOOD price data .
