Although Robinhood (Nasdaq: HOOD) is facing possible regulatory setbacks, its revenue from cryptocurrency trading in the first three months of 2024 jumped by 232 percent to $126 million. The increase was driven by the notional crypto trading volume in the quarter, which reached $36 billion, 224 percent higher.

Crypto Is the King

The overall quarterly revenue of the American brokerage over the three months increased by 40 percent year-over-year to reach $618 million. Out of the total, transaction-based revenue increased by 59 percent to $329 million, primarily driven by cryptocurrencies. Revenue from options trading also increased by 16 percent to $154 million, while equities revenue at $39 million jumped by 44 percent.

Apart from transaction-based revenue, Robinhood also generated $254 million from net interest, a jump of 22 percent, and $35 million, an increase of 35 percent, from other sources, which includes subscriptions.

While crypto demand on the platform soared, the SEC issued a Wells Notice to Robinhood regarding its cryptocurrency offerings, indicating possible enforcement action against the brokerage.

A Profitable Quarter

The quarter was also profitable for the broker, as it generated a net income of $157 million, or diluted earnings per share (EPS) of $0.18, compared to a loss of $511 million in the corresponding quarter of the previous year. Interestingly, the broker managed to reduce its operating expenses by 52 percent year-over-year to $460 million.

“We delivered significant revenue growth and margin expansion in Q1 as we remain focused on driving another year of profitable growth in 2024,” said the CFO of Robinhood, Jason Warnick. “In Q1, we set records for quarterly revenues, net income, and EPS, even as we stepped up our marketing and growth investments.”

In the three months, the assets under custody on the platform increased by 65 percent to $129.6 billion. The net deposit also jumped to $11.2 billion, growing at an annualized rate of 44 percent from the end of the previous quarter.

Looking at the performance of the ongoing quarter, Robinhood’s CEO, Vlad Tenev, said: “Q2 is off to a strong start with April being our highest month of the year for Net Deposits and Gold Subscriber growth, and we’re excited to see strong interest from over 1 million customers in our Robinhood Gold Card.”