Robinhood Markets Inc., the popular trading platform known for democratizing investing, released its operating data for May 2023, showing an increase in both stock and options trading but a decrease in cryptocurrency trading.
In May, Robinhood’s net cumulative funded accounts (NCFA) were 23.1 million, up nearly 20,000 from the previous month. However, this number only represents unique users, as it does not count existing customers who have opened multiple accounts.
Despite the increase in the number of funded accounts, Robinhood reported a decrease in its monthly active users (MAU), which fell by about 900,000 from April to May 2023, bringing the total to 10.6 million.
The trading platform saw assets under custody (AUC) rise slightly, with a 6% increase from April to $81.8 billion by the end of May. Net deposits for the month of May were $1.6 billion, an annual growth rate of 25% compared to AUC in April. Over the past year, net deposits amounted to $16.5 billion, reflecting an annual growth rate of 22% compared to May 2022 at AUC.
However, when it comes to trading volumes, Robinhood’s report showed contradictory trends. While virtual trading volumes for stocks increased by 27% to $49.4 billion and traded options contracts increased by 29% to $97.5 million, cryptocurrency trading declined. Notional cryptocurrency trading volumes fell significantly by 43% to $2.1 billion, reflecting a relatively low enthusiasm for cryptocurrency trading among Robinhood’s user base in May.
The company’s margin balances remained stable at $3.1 billion, showing no change from April 2023. On the other hand, liquidity sweep balances showed a significant increase, growing 16% from the end of April to $11.2 billion by the end of May.
The report provides insights into Robinhood’s performance in a volatile market environment, indicating the changing preferences of its users. The divergent trend in stocks and options versus cryptocurrency trading may reflect the changing investor sentiment in the evolving landscape of the financial markets.
Adding to these dynamics that could significantly affect trading volumes in the future, Robinhood announced the delisting of cryptocurrencies Solana (SOL), Cardano (ADA), and Polygon (MATIC). This decision follows recent accusations by the US Securities and Exchange Commission (SEC) against Binance and Coinbase, alleging that these platforms traded in unregistered securities. Under these circumstances, a further decline in Robinhood’s cryptocurrency trading activity can be expected.