After a record-breaking 700% surge in crypto trading revenue during Q4 2024, Robinhood may face a notable pullback in the first quarter of 2025, according to JPMorgan analyst Kenneth Worthington. The firm expects crypto volumes to drop significantly amid weakening market sentiment and reduced trading activity.
Worthington forecasts that Robinhood’s crypto trading volume fell to approximately $52 billion in Q1, down from $71 billion in the previous quarter. This decline aligns with broader market softness, particularly in digital assets during the second half of the quarter. As a result, Worthington has lowered his year-end price target for Robinhood (HOOD) stock from $45 to $44, while maintaining a neutral rating.
The Q4 crypto boom was a major driver behind the surge in Robinhood’s transaction-based revenue. However, Worthington warns that this momentum is unlikely to carry over, citing a “risk-off” environment that has diminished much of the market’s early-year gains. Robinhood’s assets under custody (AUC) are also projected to drop 5% quarter-over-quarter to $183.3 billion, though that figure still reflects a 41% increase year-over-year.
While some retail buying picked up in early April following tariff-related headlines from Washington, Worthington believes it’s unlikely to offset the broader slowdown. He also notes weakening demand for margin and derivatives trading—trends mirrored at competitor Interactive Brokers, which could further pressure Robinhood’s Q1 performance.
Source: Robinhood Crypto Revenue Expected to Fall in Q1 After Record Late 2024 Gain: JPMorgan