Robinhood Halts Overnight Trading Due to Issue With its Execution Venue
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Brokerage firm Robinhood has announced a temporary suspension of its overnight trading services due to issues with its execution venue.
In a recent post on X, the company cited problems with Blue Ocean ATS, the third-party firm that handles round-the-clock trading for Robinhood, as the reason behind the decision.
“Robinhood 24 Hour Market’s execution venue, Blue Ocean ATS (BOATS), has suspended overnight trading for tonight. 24 Hour Market orders that are open as of approx,” the company wrote.
“8 PM ET will be routed for execution starting at approx. 4 AM ET tomorrow. You may cancel your order at any time and can still place an order for another trading session.”
Blue Ocean ATS to Migrate to New System
A spokesperson for Blue Ocean ATS told CNBC that the firm faced capacity issues the previous evening, resulting in the cancellation of a small percentage of trades.
The spokesperson added that Blue Ocean ATS would be migrating to a new technology system within the next two weeks.
Robinhood’s announcement follows a day of technical problems for several brokerage firms, including Charles Schwab, which temporarily prevented some users from accessing their accounts.
The market turbulence on Monday saw the Dow Jones Industrial Average plummet over 1,000 points, while the S&P 500 experienced its worst day since 2022.
Robinhood introduced its “24/5 trading” service in May 2023, allowing users to trade from 8 p.m. ET on Sunday to 8 p.m. ET on Friday.
Robinhood 24 Hour Market's execution venue, Blue Ocean ATS (BOATs), has suspended overnight trading for tonight. 24 Hour Market orders that are open as of approx. 8 PM ET will be routed for execution starting at approx. 4 AM ET tomorrow. You may cancel your order at any time, and…
— Robinhood Help (@AskRobinhood) August 5, 2024
Overnight trading is generally restricted to the most liquid stocks and ETFs.
It remains unclear whether the suspension will extend beyond early Tuesday morning or if other brokerage firms offering overnight trading will be affected.
According to social media reports, Robinhood wasn’t the only brokerage platform experiencing issues due to the stock market volatility.
Other brokerage platforms, such as Charles Schwab, Fidelity, Vanguard, TD Ameritrade, E-Trade, UPS and CenturyLink, have reportedly experienced trading outages as well.
Robinhood Saw 224% Surge in Crypto Trading Volumes in Q1
Robinhood has experienced a substantial increase in crypto trading volumes during the first quarter, with a surge of 224% to reach $36 billion.
The growth played a significant role in driving the company’s transaction-based revenue up 59% year-over-year to $329 million, with crypto-related revenue alone witnessing a substantial 232% rise to $126 million.
The surge in crypto trading volumes on Robinhood’s platform comes as no surprise, as other publicly traded crypto peers such as Coinbase have also reported impressive first-quarter performances due to the improving conditions in the crypto market.
Earlier this year, Robinhood disclosed that it received a Wells Notice from the U.S. Securities and Exchange Commission (SEC) regarding its crypto unit.
A Wells Notice informs the recipient that the regulator has concluded an investigation against them and plans to file an enforcement action.
The SEC has previously issued Wells Notice to major industry players like Uniswap and Consensys.
