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Why Robinhood Is Waiting Before Adding More Cryptocurrencies

ByHazel R. Lang

Mar 19, 2022

Image source: Getty Images

You may be surprised to find out why.


Keypoints

  • There’s ample demand for Robinhood to add more cryptocurrencies.
  • CFO Jason Warnick recently addressed the calls to make Shiba Inu and other coins tradeable on Robinhood.
  • Warnick made clear that more currencies likely won’t be added any time soon for a simple reason.

Robinhood is a popular trading platform, especially among people who invest in cryptocurrencies. That’s why it probably won’t come as a surprise to hear that millions of thousands of people signed a petition asking the brokerage firm to add more coins to its lineup. Specifically, the petition requested the addition of Shiba Inu (SHIB) as a trading option on Robinhood.

Despite these calls to offer more digital currencies, Robinhood has made clear that it won’t be adding Shiba Inu or other virtual coins to its lineup right now. Its current list includes Bitcoin (BTC), Dogecoin (DOGE), Ethereum (ETH), Litecoin (LTC), and others.

Here’s why investors shouldn’t expect to see more virtual currencies from this brokerage firm any time soon.

Regulation plays a key role

Robinhood’s chief financial officer, Jason Warnick, recently explained the company’s reluctance to add Shiba Inu while speaking at The Wall Street Journal‘s virtual CFO Network Summit in January. “We’re a highly regulated company in a highly regulated industry, and we think it’s important that we get a bit more clarity from regulators,” Warnick said. He went on to explain that complying with government regulations is one of Robinhood’s biggest priorities.

Recently, there have been some efforts on the part of lawmakers to crack down on cryptocurrency. So it’s not surprising that Robinhood leaders want to get clear on what will be allowed on crypto trading platforms — and what new burdens brokerage firms may face in the future to make trading virtual coins possible. The last thing a brokerage firm wants is to begin allowing users to trade more coins, only to have to pull back on their offerings or to get stuck navigating major regulatory changes if laws shift.

Robinhood’s chief legal officer, Dan Gallagher, has previously spoken out against additional cryptocurrency regulations. He’s cited Dodd-Frank reforms and the complexity they create as one reason why lawmakers shouldn’t do more. Gallagher even went so far as to call the idea of ​​imposing new regulations on cryptocurrencies “one of the stupidest ideas” he’s heard in a long time.

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However, with the Securities and Exchange Commission indicating additional regulatory action on crypto is a priority, the likelihood there will soon be more rules to follow is high. And that means Robinhood would need to comply, despite Gallagher’s opinion that those rules aren’t necessary.

Some platforms do offer SHIB and other cryptocurrencies

While Robinhood may not be eager to add to its cryptocurrency lineup, there are plenty of other brokerage firms out there that do provide access to Shiba Inu and that regularly update their crypto offerings.

If you’re looking for a wider selection of virtual currencies to buy, and you find Robinhood’s offerings too limited, check out some of the best cryptocurrency apps and exchanges to explore some alternatives.

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