Online brokerage Robinhood Markets is set to lay off 150 full-time staff members as a result of decreased trading volumes due to regulatory enforcement actions. This marks the third round of layoffs for the company within a year. The job cuts will be implemented in various departments including customer experience, platform shared services, customer trust and safety, and safety and productivity. Despite previous rounds of cuts affecting at least 1,000 employees, Robinhood employed 2,300 people according to its annual report last year. Last week, the company acquired credit-card startup X1 to diversify its income streams. Additionally, Robinhood now allows stock traders to access major markets for 24 hours a day, five days a week. However, the company has faced regulatory scrutiny in the past, resulting in fines and a settlement with the US Securities and Exchange Commission (SEC). Recently, the SEC’s enforcement actions against crypto companies have caused concern among industry players, including Robinhood. Coinbase, the largest US exchange, is currently facing an SEC enforcement action for operating as an unregistered broker and crypto clearinghouse. In response to regulatory pressure, Robinhood has delisted certain tokens listed as unregistered securities by the SEC, cutting off trading revenues for affected pairs. Despite these challenges, the growing interest from institutional investors may provide a lifeline for the company. Several investment firms have recently filed applications with the SEC to offer a spot Bitcoin Exchange-Traded Fund, which has boosted Bitcoin’s price and could lead to increased institutional inflows and liquidity. Additionally, institutional trading firms joining Robinhood’s platform can provide customers with access to more liquid markets. Sygnum Bank has also announced a new crypto asset custody and brokerage service to match buy and sell orders.
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