Robinhood Chain is experiencing a notable drop in usage, with average daily transactions falling 42% from 10.8 million in mid-September to 6.2 million in early October. The decline comes despite Robinhood continuing to pay network fees for qualifying customer swaps.
More than $1 billion remains locked in applications operating on the blockchain, but transaction activity and spot trading volumes have weakened. CoinDesk calculations using growthepie data show that Robinhood Chain processed an average of 6.2 million transactions daily from Oct. 2 to Oct. 8, compared with 10.8 million between Sept. 10 and Sept. 16. Activity also dropped 20% from the preceding week.
Robinhood launched the network in July to give users access to token trading, borrowing and lending through applications connected to Ethereum. The company has also announced plans for 24/7 trading of tokens tied to stocks and funds.
Every transaction on the network generates a fee, while applications built on the blockchain can impose additional charges for trades and loans. A Bernstein research note from last month estimated that Robinhood collects around 90% of network fees. With fewer transactions taking place, the brokerage could see a decline in fee income.
The latest figures mark a reversal from September. When CoinDesk reported on Sept. 19 that network fees had dropped 97%, transaction counts were still close to their highest levels and weekly trading volumes continued to expand. Both metrics have since moved lower.
The number of active addresses has also contracted. Daily activity averaged roughly 322,000 addresses during the latest week, down 31% from mid-September. However, the reduction does not necessarily reflect an equivalent decline in individual users. A single person can manage multiple addresses, and automated trading bots can generate substantial transaction activity.
Spot trading weakens as deposits edge higher
Spot exchanges recorded $7.45 billion in volume between Oct. 2 and Oct. 8, a 21% decline from the previous week’s $9.46 billion, based on CoinDesk calculations using DefiLlama data. Uniswap, which enables users to exchange tokens directly without a centralized intermediary, accounted for approximately 77% of that volume.
Despite the reduction in trading, the amount of capital held in Robinhood Chain applications has remained firm.
Deposits across lending and trading apps increased by around 2% over the week to $1.04 billion. The network’s stablecoin supply also rose slightly to approximately $1.10 billion. These figures suggest that users are retaining their funds on the blockchain but putting them to work less frequently.
Perpetual futures trading has continued to grow, bucking the wider decline. These contracts allow traders to speculate on price movements without directly owning the underlying tokens.
DefiLlama’s rolling seven-day data showed perpetual futures volume at approximately $7.35 billion on Friday, up 26%.
Network fee revenue, however, has fallen sharply. Users paid an average of about $65,000 per day in fees from Oct. 2 to Oct. 8, representing a 39% decline from the previous week. The amount is significantly below the roughly $8 million the network generated on its busiest day in early September.
Fee promotions aim to revive activity
Robinhood and its partners are attempting to encourage more transactions through incentives. Trading platform Arcus began distributing additional reward points on Oct. 1 for stock-token swaps made through Robinhood Wallet. Robinhood also extended a fee promotion that was originally set to expire on Sept. 29.
The brokerage will now cover network fees for swaps exceeding 50 cents through its wallet until Dec. 31. The extension gives Robinhood Chain less than three months to increase trading activity among users who have deposited more than $1 billion on the network.
The longer-term challenge will come after the offer ends. Once customers are responsible for paying their own transaction fees, Robinhood will need to determine whether users remain active without the financial incentive.
