Trading app giant Robinhood is currently issuing a warning on the damage the crypto regulations could do to its business.
More so, there’s an amendment to an S-1 Form files with the U.S. Securities and Exchange Commission (SEC). Also, the financial services company drafts out the several risks to its cryptocurrency products and services.
Meanwhile, Robinhood replies and says those risks involve the haziness around what future industry regulations might look like.
“The regulatory landscape involving cryptocurrencies is constantly evolving…”
“and [Robinhood Crypto] may be subject to fines, penalties, or loss of regulatory licenses…” Robinhood explains further,
“if the SEC or any other regulators issue new regulations or interpretive guidance…”
“related to cryptocurrencies that prohibit any of our current business practices.”
Robinhood Crypto wallet testing
Additionally, Customers already are testing cryptocurrency wallets on Robinhood since this month. Also, Robinhood launches out out a new feature in September. This will permit crypto investors to buy digital assets without commission on a recurring basis.
Notably, during SEC filing, Robinhood highlights that there’s not safety guarantee on the company’s wallets. Furthermore, The trading platform reveals it holds the “overwhelming majority” of its crypto in storage. However, uses wallets for day-to-day operations support.
“We cannot provide assurance that any or all of our wallets will not be…”
“hacked or compromised such that cryptocurrencies are sent to one or more private…” Robinhood notes
“addresses that we do not control, which could result in the loss of some or all of the…”
“cryptocurrencies that RHC holds in custody on behalf of customers. Any such losses may be…”
“significant, and we may not be able to obtain insurance coverage for some or all of those losses.”
Earlier this year, Robinhood announces restrictions on its customers from buying crypto. While, noting “extraordinary market conditions.”. Also, The firm places a hold on users from buying shares in Gamestop (GME). Meanwhile, After the retail trading buzz on Reddit, its price spikes massively.