Robinhood, a Menlo Park, California-based Stock and crypto trading platform, has reportedly applied for a bank charter with regulators in the United States to add traditional financial services to the crypto platform. The company believes that securing approval from the Office of the Comptroller of the Currency would be a first step towards being able to offer traditional banking products and services. It is expected that full-service banks would operate alongside its mobile-centered trading arm that allows users to trade cryptocurrencies, funds, and options on their phones or desktops. According to the reports, in December last year, Robinhood was the home to 5 million users that use crypto trading on the platform.
In late last year, Robinhood had to make a turnaround on their effort to offer a checking and savings service to the U.S. consumers. Though, the company had claimed that customer deposits of up to USD 250,000 would be insured by the Securities Investor Protection Corporation, a not-for-profit community. But it later revealed the entity only they guaranteed funds for purchasing securities. The company met a lot of criticism for their rebranding the service’s name to cash management and removed references to deposit protection. As per the reports, U.S. politicians subsequently accused the company of lacking in offering full transparency to the 850,000 consumers who had expressed an interest in the service.
The reports further revealed that Robinhood is planning to introduce an initial public offering, which recently valued at USD 5.6 billion after an investment round. This valuation makes Robinhood the second-most valuable startup in the U.S. FinTech industry.