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Robinhood Identified as Third-Largest BTC Wallet Owner

Trent Alan
Last updated: | 3 min read
BTC Wallet robinhood
Posted to Flickr by TechCrunch

The previously unidentified large BTC wallet that sparked widespread conjecture and analysis recently was identified last week. According to wallet data from Arkham Intelligence, investing and trading platform Robinhood holds over $3 billion in Bitcoin in this single BTC wallet, placing it behind only Binance and Bitfinex as one of the largest holders of Bitcoin.

Robinhood’s Hidden Treasure

The identification of the BTC wallet solves one of the more perplexing riddles that had captured the attention of market analysts and cryptocurrency enthusiasts. For several months, speculation was rampant about who could own such a large amount of Bitcoin. Robinhood has yet to make a public statement regarding these holdings.

When asked about the evidence suggesting Robinhood’s ownership, Alexei Zamyatin, CEO and co-founder of Interlay, mentioned in an email correspondence with, “I do not have any more evidence than what has been shared by blockchain analytics companies. It does feel like a pretty substantial acquisition, perhaps too substantial.”

Arkham Intelligence confirmed to CoinDesk that the cryptocurrency trading firm Jump Trading is the custodian of the wallet. The firm specializes in algorithmic and high-frequency trading strategies and has now been linked to Robinhood’s considerable Bitcoin holdings.

Interestingly, the revelation about Robinhood’s BTC wallet holdings comes amid a decline in cryptocurrency trading volumes on its platform. According to the company’s most recent earnings release, Robinhood reported a crypto trading revenue of just $31 million in the second quarter, marking an 18% decrease from the $38 million reported in the first quarter. The decline is also part of a broader 7% sequential drop in total trading revenue across all categories.

In trying to decipher Robinhood’s possible motivations for this massive position, Zamyatin speculated, “I doubt it is purely for investment purposes. It would not be unlikely that Robinhood is gearing up to release institutional BTC products or plans to expand its crypto-business and decided to accumulate in the current market.”

Past Speculations Put to Rest

The BTC wallet, now known to be owned by Robinhood, has been a focal point of discussion and speculation. Initially, it was believed that more prominent financial institutions or cryptocurrency exchanges could be behind this massive accumulation. The wallet’s Bitcoin value fluctuates in accordance with market conditions, most recently dropping from $3.51 billion to $3.08 billion.

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Before this revelation, various theories had circled about potential owners of the BTC wallet. Names like BlackRock and Gemini were often mentioned as possible candidates. The substantial size of the wallet had led to it being viewed as a significant player in the Bitcoin market, even as its owner remained unknown.

Investors speculating Blackrock was building up a position ahead of an ETF approval saw it as a bullish event for BTC. Zamyatin believes the narrative hasn’t changed even if the wallet’s owner is different.

“Assuming it was indeed Robinhood building up a BTC position – does that not mean that another successful trading platform might be entering the market?” And Blackrock may yet be building up a position,” he said.

This finding could have multiple ramifications for Robinhood, which has been transparent about its declining crypto trading volumes. Identifying such a large BTC wallet under its ownership could invite further scrutiny and questions about the company’s Bitcoin exposure.

While the trading platform has experienced a decline in crypto trading volumes, its considerable Bitcoin holdings in the BTC wallet show it still has a lot of skin in the crypto trading game. As the crypto market continues to evolve, the role and impact of large holders like Robinhood will be interesting to observe, even as the platform remains silent on this newfound revelation.