Robinhood’s Crypto Momentum Stalls in Q1 After Historic Q4 Rally, JPMorgan Cautions
Robinhood’s remarkable crypto trading surge at the end of 2024 appears to be losing steam, with JPMorgan forecasting a notable drop in digital asset activity for the first quarter of 2025.
After posting a staggering 700% increase in cryptocurrency trading revenue during Q4 — a key driver of Robinhood’s overall transaction-based income — the platform now faces a more subdued outlook. JPMorgan analyst Kenneth Worthington expects a meaningful decline in both equity and crypto trading activity when the company reports earnings Wednesday after market close.
Worthington estimates that crypto trading volumes dropped to $52 billion in Q1, down from $71 billion in the previous quarter. He attributes the slowdown to shifting investor sentiment and a more defensive market stance, noting that enthusiasm for risk assets faded significantly during the second half of the quarter.
Robinhood’s total assets under custody are also expected to dip 5% from Q4 levels to $183.3 billion, although they remain up 41% year-over-year — underscoring the platform’s long-term growth trend despite short-term headwinds.
While some retail buying momentum resurfaced in early April following tariff-related headlines from Washington, Worthington doesn’t believe the rebound was strong enough to offset the broader Q1 weakness. He also pointed to sluggish demand for margin and derivatives trading — a dynamic affecting peer firms like Interactive Brokers as well — as a further drag on platform engagement.
JPMorgan maintained a neutral stance on the stock and lowered its price target to $44, down $1 from prior forecasts, suggesting a potential 10% decline from the current share price near $49.
