Summary: Robinhood Settles $9M Lawsuit Over Unsolicited Text Messages
Robinhood has agreed to a $9 million settlement in a class-action lawsuit regarding unsolicited text messages sent through its referral program. The settlement covers approximately 827,327 consumers who received these messages between August 2017 and February 2024. Each participating member is expected to receive a cash payment ranging from $111 to $170, depending on the number of validated claims.
Robinhood’s Legal Settlement Over Unsolicited Messages
- Robinhood has reached a $9 million settlement in a class-action lawsuit related to unsolicited text messages sent through its referral program.
- The lawsuit alleged violations of Washington state’s consumer protection laws.
- Plaintiffs claimed that the referral program violated Washington Commercial Electronic Mail Act and Consumer Protection Act.
The referral program allowed existing users to send referral text messages to friends, inviting them to join Robinhood and receive free stocks upon signing up. The settlement encompasses over 800,000 consumers who received these messages between August 2017 and February 2024. The court approved the settlement as reasonable, with each participant expected to receive a cash payment based on the number of claims submitted.
Bitstamp Acquisition by Robinhood
Alongside the legal settlement, Robinhood has been making significant moves in the cryptocurrency space, including the recent announcement of its acquisition of Bitstamp Ltd. The acquisition, valued at $200 million, is expected to close in the first half of 2025 and signals Robinhood’s entry into the institutional crypto market and global expansion.
Bitstamp, established in 2011, operates globally and holds regulatory approvals across various markets. The acquisition will allow Robinhood access to Bitstamp’s expertise and presence in key markets, facilitating its international expansion efforts. By integrating Bitstamp’s customer-centric approach, Robinhood aims to enhance safety and user experience for both retail and institutional investors.
The acquisition of Bitstamp will enable Robinhood to offer a wider range of crypto assets, including staking and lending products, to its users, expanding its cryptocurrency portfolio to over 85 assets.
Hot Take: Robinhood’s Legal Settlement and Crypto Expansion
As Robinhood settles a $9 million lawsuit over unsolicited text messages, the platform continues to make significant advancements in the crypto space. The acquisition of Bitstamp marks a strategic move for Robinhood, expanding its crypto offerings and strengthening its presence in international markets. This development reinforces Robinhood’s commitment to providing a diverse and secure cryptocurrency trading experience for its users.
Sources:
1. The Street – Robinhood Bets Big on Crypto’s Future with $200 Million Bitstamp Buyout
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