American no-fee broker Robinhood announced on Tuesday that it has acquired the cross-exchange trading platform, Cove Markets. This will allow investors on Robinhood to easily manage their cryptocurrency accounts.
The official blog post highlighted that both companies ‘share a common goal of making investing in cryptocurrencies simpler and lower cost’.
As a part of the acquisition, the Cove Markets Co-Founders, Scott Knudsen and Victor Glava, along with their team, will join Robinhood’s crypto unit. However, neither of the companies have disclosed the amount involved in the acquisition deal.
“Scott, Victor and the Cove Markets team will bolster our crypto trading platform and help us strengthen our leadership in the crypto industry,” Christine Brown, Chief Operating Officer of Robinhood Crypto, said.
“Their wealth of experience in trading execution and crypto market infrastructure will help us to build more powerful trading capabilities, bringing the benefits of better competition in the crypto markets to our customers.”
Filling the Gap Between Crypto Exchanges
Founded three years ago, Cove Markets has been building tools to help crypto investors manage their accounts and is maintained across multiple exchanges.
“Now, we are excited to join Robinhood to help build a world-class platform that can improve trading for millions of customers,” Knudsen, said.
Robinhood started to offer cryptocurrency investment services in 2018 in addition to its regular commission-free stock trading services. Though it does not allow investors to own and move crypto like other dedicated crypto exchanges, it is in the process of rolling out a crypto wallet.
Meanwhile, crypto trading demand on Robinhood soared with the initial rally of meme tokens earlier this year as it was the only credible American exchange to list them at the time. Furthermore, the platform generated more than half of its transaction-based revenue in Q2 of 2021 from crypto trading, but the demand faded away in the next quarter.
