To The Moon

$Robinhood(HOOD)$

Robinhood (NASDAQ: HOOD) has been one of the market's most surprising turnaround stories of 2025. After struggling for most of the past two years, shares of the millennial-favorite trading platform have skyrocketed over 150% year-to-date, fueled by a resurgence in retail trading, a renewed bull run in crypto, and a clearer strategic roadmap.

But with shares now hovering near multi-year highs and the company’s valuation stretched relative to fundamentals, the question arises: Is Robinhood still worth buying, or has the easy money already been made?

In this article, we’ll examine what’s driving Robinhood’s dramatic resurgence, how its crypto pivot is reshaping its business model, whether valuation is still compelling, and what risks investors need to consider heading into the second half of 2025.

From Meme Stock Casualty to Growth Revival

Just two years ago, Robinhood was widely written off as a broken pandemic-era stock, plagued by regulatory scrutiny, declining user engagement, and profitability concerns. The company was synonymous with speculative frenzy, meme stock chaos, and risky options trading.

But the script has flipped dramatically in 2024 and 2025.

Robinhood’s active users are back on the rise, total net deposits are hitting new records, and the platform has benefited immensely from renewed enthusiasm in both tech stocks and crypto tokens. The firm has also launched a host of new features, including a crypto wallet, international expansion, and retirement accounts—all of which are helping it diversify revenue away from traditional payment-for-order-flow (PFOF) trading.

The result? A stunning 150% rally in HOOD shares year-to-date, making it one of the best-performing fintech names on the market.

Crypto Catalysts: Robinhood’s Secret Weapon?

One of the most underappreciated drivers of Robinhood’s stock surge is its growing exposure to crypto—both in retail trading and custody services. In Q1 2025, Robinhood's crypto revenue surged 232% year-over-year, accounting for more than 30% of transaction-based revenue.

The bullish case hinges on two major developments:

1. Crypto Winter is Over: Bitcoin and Ethereum have soared back to multi-year highs, spurred by ETF approvals, increased institutional participation, and the broader AI-driven tech rally lifting digital assets along with it.

2. Robinhood’s Acquisition of Bitstamp: Perhaps the most transformative move this year was Robinhood’s $200 million acquisition of Bitstamp, one of Europe’s longest-standing crypto exchanges. This not only gives Robinhood regulatory approval and an immediate international footprint, but also credibility in the institutional crypto market.

Bitstamp gives Robinhood access to:

• 50+ global licenses and registrations

• Institutional order books and custody services

• A seasoned compliance team with deep EU roots

This positions HOOD as more than just a “dogecoin casino”—it’s building the rails for long-term crypto infrastructure, both in the U.S. and abroad.

Reigniting Retail Interest and Engagement

Another growth engine? The return of the retail trader.

Robinhood’s platform was built for the retail investor, and that audience is once again active. Monthly Active Users (MAUs) grew sequentially for the first time in over a year during Q1, rising from 10.9 million to 11.7 million. Meanwhile, Assets Under Custody (AUC) jumped 65% YoY to over $130 billion, and net deposits remain robust.

Retail engagement is being driven by:

• The rise of zero-day options (0DTE) and high-frequency trading

• Popular meme stock revivals like GameStop and AMC

• Robinhood Gold (its premium subscription), which now has over 1.7 million users

These trends are helping diversify Robinhood’s income base, with net interest revenue and subscriptions becoming increasingly important alongside transaction-based income.

Valuation: Justified Optimism or Euphoria?

Robinhood’s valuation has soared alongside its share price. As of late June 2025, Robinhood trades at:

• ~11x forward revenue

• Over 40x forward EBITDA

• PEG ratio north of 2.0

While not nosebleed levels by growth stock standards, it’s a far cry from the deep value territory the stock found itself in during 2022–2023.

The bullish thesis is that Robinhood is finally turning profitable, with strong operating leverage. The company posted $157 million in adjusted EBITDA in Q1 2025 and is projected to generate over $600 million in EBITDA for the full year.

That said, bulls must justify these multiples with continued growth in:

• MAUs and deposits

• Crypto volume

• Interest-based revenues in a potentially falling rate environment

If growth falters or competition intensifies (from players like Coinbase, Charles Schwab, or emerging fintechs), valuation could quickly compress.

Key Insights for Investors

Here are 7 key takeaways that long-term investors should keep in mind:

1. Robinhood’s Crypto Expansion Is Real The Bitstamp acquisition positions HOOD for long-term relevance in global crypto infrastructure, not just retail speculation.

2. Retail Traders Are Coming Back Higher equity markets and crypto rallies have revived retail interest, driving up engagement and deposits.

3. Revenue Streams Are More Diversified Interest income, Robinhood Gold, and crypto wallets are helping HOOD reduce dependence on trading alone.

4. Profitability Has Arrived Adjusted EBITDA has turned positive, and GAAP profitability may be within reach by year-end 2025.

5. Valuation Is Stretched—but Not Insane Multiples are high, but earnings growth and margin expansion could support them—if momentum continues.

6. Regulatory Risk Remains Ongoing scrutiny over PFOF, crypto regulations, and global compliance post-Bitstamp remain key risks.

7. Competition Is Heating Up From Coinbase on the crypto side to SoFi and Schwab in retail finance, Robinhood faces stiff competition in every segment it’s entering.

Risks That Can’t Be Ignored

While Robinhood’s current story is compelling, there are critical risks that investors need to keep on their radar:

• Regulatory Uncertainty: Especially around crypto custody, staking, and payment-for-order-flow models, which remain hot-button issues for the SEC and global watchdogs.

• Interest Rate Sensitivity: A decline in Fed rates would compress net interest income, which currently makes up over 40% of Robinhood’s total revenue.

• Execution Risk: Integrating Bitstamp and expanding internationally are no small feats. Any missteps could derail the growth narrative.

• Volatility in User Behavior: Retail traders are notoriously fickle, and user churn could re-emerge if markets cool off.

Conclusion: Buy, Hold, or Wait?

Robinhood has undergone a remarkable transformation in 2025. The combination of a renewed bull market, strong crypto tailwinds, product diversification, and disciplined cost management has reignited investor optimism and sent shares surging 150% year-to-date.

For growth-oriented investors, Robinhood offers a high-risk, high-reward opportunity to gain exposure to a unique hybrid of fintech and crypto infrastructure. Its newly acquired international platform (Bitstamp), improving margins, and surging user deposits offer compelling reasons to believe that this rally may be more than just hype.

However, at current valuations, new investors need to tread carefully. While the long-term story is improving, much of the short-term upside may already be priced in. A pullback could present a better entry point, especially if macro headwinds or regulatory setbacks emerge.

Verdict: Robinhood is no longer a broken pandemic stock—it’s a reborn fintech and crypto player. But after a 150% run, investors should wait for consolidation or weakness before adding aggressively.

Final Takeaways

• Robinhood has reinvented itself in 2025, leveraging a crypto comeback and stronger fundamentals to surge 150% YTD.

• Bitstamp adds global reach and institutional credibility in crypto.

• Valuation is high, but so is momentum—making it a stock to watch, not chase.

• Consider averaging in slowly, or waiting for dips before taking full positions.

Disclaimer: I want to make it clear that I am not a financial advisor, and nothing I say is intended to be a recommendation to buy or sell any financial instrument. Additionally, it's important to remember that there are no guarantees or certainties in trading or investing, and you should never invest money that you can't afford to lose.

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