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Robinhood (HOOD) Slumps on Earnings Warning, Dogecoin (DOGE) Brings in The Bucks

Robinhood (HOOD) Slumps on Earnings Warning, Dogecoin (DOGE) Brings in The Bucks

Nick Cawley, Strategist

Dogecoin (DOGE) Price, Chart, and Analysis

  • Robinhood shares crash despite Q2 revenue soaring to $565 million.
  • The company warns about a slowdown in cryptocurrency trading.

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Trading app Robinhood (HOOD) released Q2 earnings after the US bell yesterday, showing revenues hitting $565 million in the second quarter of this year, compared to $244 million in Q2 2020, with cryptocurrency trading accounting for $233 million of revenue announced. Despite the record numbers, Robinhood shares slumped post-announcement after the company warned of lower Q3 revenues. The company highlighted that trading in meme-inspired Dogecoin (DOGE) accounted for 34% of its cryptocurrency turnover in the second quarter and that if this revenue is not replaced in Q3, that business could be ‘adversely affected’.

Robinhood shares closed at $49.74 pre-announcement and are currently seen over 13% lower at $43 in pre-market trading.

Chart via Coinmarket cap.com

The surge in Q2 cryptocurrency trading, highlighted by Robinhood, was in part driven by the alt-coin market. The alt-coin market capitalization – total cryptocurrency market cap minus Bitcoin market cap – hit a peak valuation of just under $1.5 trillion in mid-May as a wide range of coins posted double- and triple-digit percentage gains in 2021. Elon Musk and Reddit pet crypto, Dogecoin (DOGE) showed probably the most spectacular rally in the first few months of this year, soaring from under 1 cent at the start of 2021 to over 74 cents in early-to-mid May. Dogecoin is currently quoted on either side of 30 cents.

Dogecoin (DOGE) Daily Price Chart August 19, 2021

Chart via Tradingview.com

Cryptocurrency activity has slowed in the past couple of weeks with market leader Bitcoin (BTC) struggling to break the $46,500 area with any conviction. Overall market sentiment remains positive but this period of consolidation will hurt Robinhood turnover. Robinhood currently offers 7 different cryptocurrencies on its trading platform – Bitcoin (BTC), Bitcoin Cash (BCH), Bitcoin SV (BSV), Ethereum (ETH), Ethereum Classic (ETC), Litecoin (LTC), and Dogecoin (DOGE). While these coins provide investors a range to gain exposure to the cryptocurrency market, heavy activity, and gains, are currently being seen in other alt-coins, including Cardano (ADA), Solana (SOL), and Terra (LUNA).

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What is your view on Dogecoin – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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