Robinhood Intends to Turn into a Fiat On-ramp for Crypto by Supporting Deposits & Withdrawals

Robinhood, the trading app popular among the retail and younger investors, announced this week that it intends to provide its users the ability to deposit and withdraw cryptocurrencies, effectively becoming a fiat on-ramp for cryptocurrencies. The trading platform said on Twitter,

“So much interest in Crypto! To be crystal clear, we fully intend to provide the ability to deposit and withdraw cryptocurrencies, including DOGE.”

Currently, Robinhood supports a limited number of digital currencies viz. Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Dogecoin (DOGE), Ethereum Classic (ETC), Litecoin (LTC), and Bitcoin SV (BSV).

For now, they do not allow buyers to technically own the digital currency, it is more of an IOU because they control the keys.

Robinhood said it does not currently invest in crypto or use any of the customers’ crypto for its own benefit.

They clarified that cryptocurrencies purchased and owned by their customers are held and custodied in the app’s wallets, and Robinhood only receives coins when the customer trades have already settled.

“We understand that the community wants more insight into which addresses belong to us and how we operate our wallets. We are not alone. Just like other crypto platforms, for operational security reasons and to protect customer privacy, we will not confirm which addresses do or do not belong to us.”

The clarification came after the reports that Robinhood might be the owner of the world’s biggest Dogecoin address. This is because of the timing of the creation of the digital wallet for the storage of DOGE, June 2018, coinciding with Robinhood’s offering of the meme coin trading to its customers in July of 2018.

“It almost certainly belongs to Robinhood,” said Tom Robinson, chief scientist and co-founder of blockchain data tracker Elliptic.

“The timings of its creation, and the creation of the addresses that it received funds from, match the timings of Robinhood’s support of Dogecoin.”

Currently trading around $0.50, Dogecoin has surged nearly 800% YTD. As we reported, a few addresses hold the majority of the cryptocurrency, which is based on the meme of a Shiba Inu.

Last week, Tesla CEO Elon Musk said this “too much concentration” is the only real issue with the cryptocurrency and “If major Dogecoin holders sell most of their coins, it will get my full support.”

He also offered to pay the biggest holders to “void their accounts.”

Musk further tweeted his suspicion that Robinhood could be the biggest holder of DOGE. He later supported Robinhood's call to explain the broker’s decision to curb trading in GameStop shares and DOGE in January.