Stock trading platform Robinhood poised for inclusion in S&P 500 roster, Bitcoin strategy falling short of affirmation

Robinhood Joins S&P 500 as Crypto Trading Revenue Soars

In a significant move, online brokerage platform Robinhood is set to join the S&P 500 on September 22, as announced by S&P Dow Jones Indices. This comes after a strong performance in the second quarter, with the company reporting a 45% increase in total sales, reaching $989 million.

Robinhood, founded by Vladimir Tenev and Baiju Bhatt, has been making headlines for its impressive growth in the crypto market. The company generated an impressive $160 million in crypto trading revenue during the second quarter, marking a 98% increase from a year ago. Options-based income has once again become Robinhood's main money maker, surpassing crypto trading revenue, with transaction-based revenues for options increasing to $265 million.

The surge in cryptocurrency trading revenues can be attributed to the rising institutional investor interest in cryptocurrencies. This interest has led to price gains among Bitcoin, Ethereum, and other leading assets, as well as massive inflows to crypto-based exchange-traded funds.

Interestingly, despite its market value exceeding the S&P's threshold for inclusion, Bitcoin treasury firm Strategy was not included in the S&P 500. Meanwhile, Strategy, which holds more than $70 billion worth of Bitcoin, pioneered the digital assets treasury strategy that numerous other firms have since adopted.

Robinhood's strong performance also extends to its equities trading, with transaction-based revenues for equities increasing quarter-over-quarter to $66 million. The company reported a net income of $386 million for the second quarter, up $50 million year-over-year, and an earnings per share mark of $0.42.

Following the impressive results, Robinhood's share price soared past $108 per share after closing at around $101 in after-market trading. However, the company's shares dropped nearly 3% in after-market trading on the day of the S&P 500 announcement.

The addition of Robinhood and other digital asset-focused firms like Advertising technology firm AppLovin to the S&P 500 underscores the growing might of these companies in the financial market. The S&P 500 reshuffles annually on the first Friday of the last month of the third quarter, which ends in September.

Coinbase, the largest cryptocurrency exchange in the U.S., began trading on the S&P index on May 19, marking another milestone for the crypto industry's integration into the mainstream financial market. As these companies continue to thrive and grow, the future of the digital asset market looks promising.

Stock trading platform Robinhood poised for inclusion in S&P 500 roster, Bitcoin strategy falling short of affirmation