Robinhood explores launching its own stablecoin

Following this announcement, the move may position the financial institution to take some market share from Tether’s USDT, which represents over two-thirds of the overall stablecoin landscape. According to the company’s officials, the fintech could still decide not to proceed with the offering. 

In addition, currently there are no imminent plans to issue a stablecoin, the type of crypto that was developed to maintain a stable value by being pegged to a reserve asset. Robinhood Markets will continue to focus on meeting the needs, preferences, and demands of its customers and clients in an ever-evolving market, while also prioritising the process of remaining compliant with the laws and regulatory requirements of the industry. 

More insights on the stablecoin launch initiative

Stablecoins, pegged to real-world assets, often invest in government-issued debt in order to maintain their value, generating significant profits. Tether, for instance, reported USD 5.2 billion in profit during the first half of the year. This trend coincides with the introduction of the Markets in Crypto Assets (MiCA) regulatory framework in Europe, which provides emerging guidance on crypto tokens.

The rollout of its own stablecoin would mark an expansion in Robinhood’s cryptocurrency business, which has been evolving as of late in terms of trading volume. At the same time, the initiative could also potentially weaken Tether’s place in the stablecoin market, mainly due to stricter regulations in the regions of Europe. Under the MiCA rules, crypto exchanges in the European Union may also be compelled to remove stablecoins issued by firms and financial institutions that do not possess the required licences. 

Earlier in September 2024, Revolut also announced the preparations for launching its stablecoin.