On CNBC’s “Squawk on the Street,” Jim Cramer revealed he was surprised to see that the meme-inspired cryptocurrency Dogecoin (DOGE) represented most of the revenue commission-free trading platform Robinhood saw in the second quarter of the year.
The company’s quarterly revenue was $565 million, representing an increase of 131% year over year. The average revenue per user was $112, down from $115. Notably, 62% of the company’s revenue was associated with this year’s DOGE trading frenzy.
As a result, Robinhood revealed it expects “seasonal headwinds and lower trading activity across the industry to result in lower revenues and considerably fewer new funded accounts,” as Benzinga reports.
Robinhood noted that the second quarter of the year was the first time a larger share of new customers placed their first trade in a cryptocurrency rather than equities. To Jim Cramer, this means the company has become a cryptocurrency one, instead of an equities firm. He said:
When you peel back the onion of Robinhood it seems like it’s a Dogecoin gateway.
As CryptoGlobe reported, search interest for the meme-inspired cryptocurrency exploded during its massive 10,000% price rally, going from an average of 135,000 monthly searches in April 2020 to 16.5 million in April 2021.
The surge was seemingly related to the WallStreetBets subreddit and its battle against hedge funds over the price of GameStop’s shares. It started after a parody account on Twitter going by WSB Chairman asked whether DOGE had ever traded at $1, other users piled on.
At one point, DOGE’s trading volume briefly overtook that of Bitcoin and Ethereum on Binance. Notably, search interest for DOGE cooled down in February when Tesla CEO Elon Musk and other celebrities first started tweeting about the meme-inspired cryptocurrency.
Cramer added that customers opening new accounts to trade DOGE did not look sustainable, and he would prefer seeing investors put money in companies rather than engaging in speculative trading.
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