Investing app Robinhood (HOOD) said Wednesday it will provide a crypto wallet for customers, letting them send and receive crypto assets off its platform.
Officially live in early 2022, the service gives an entirely new set of retail investors keys to the crypto sector. With this added access comes risks for customers and the chance the company is changing how users interact with its platform.
The announcement comes after reports that Robinhood is publicly beta testing a wallet service, something customers have requested over the past year.
Almost all cryptocurrency exchanges allow customers to transact on and off their platform. Robinhood still hasn’t given that functionality to customers.
Unlike ACH bank transfers for fiat currencies, crypto transactions place greater responsibility on users because blockchain-based transactions are permanent.
Most exchange-based wallet services offer a copy/paste feature that reduces mistakes in sending “on-chain transactions.” However, misplacing just one digit in a wallet address during a crypto transaction sends a user’s money to the wrong address permanently.
A crypto wallet allows users to send and receive cryptocurrency to and from other wallet addresses.
Previously, Robinhood held all its customers’ cryptocurrency and users could not take their holdings off the platform.
The wallet service comes as Robinhood rolls out more crypto trading features, such as the ability to place recurring buy orders to dollar cost average into a coin, a strategy that helps investors reduce volatility. Brown said Robinhood is looking to add more crypto assets “for later this year and into 2022.”
Shares of Robinhood have declined steadily since spiking at the beginning of August. The stock is now at $42, about 21% higher than its July IPO close.
