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Robinhood Settles with California DOJ Over Crypto Withdrawal Issues
The DOJ claims Robinhood misled crypto traders by advertising crypto could be moved off-exchange.
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Stock and crypto trading company Robinhood has agreed to pay a $3.9 million settlement to the California Department of Justice over traders' inability to move purchased cryptocurrencies off of the platform prior to 2022.
What’s the scoop?
- Customer Impact: The settlement addresses the grievances of users who could not withdraw their crypto during 2018-2022, and had to sell it back to Robinhood to exit the platform.
- Withdrawal Access and Custody Clarity: Robinhood must guarantee customers can withdraw crypto to external wallets and clearly disclose that it holds custody of assets and may delay settlements during network security concerns.
- DOJ’s Stance: The California DOJ’s action is part of broader scrutiny aimed at crypto platforms, focusing on transparency and user rights.
Bankless Take:
Robinhood’s settlement comes after the company has taken steps to double down on crypto by acquiring the oldest running crypto exchange, Bitstamp. There still may be more legal issues ahead tied to the crypto unit after Robinhood received a Wells Notice from the SEC this past May.
Robinhood Brings Solana Support to its Wallet on Bankless
You still can’t buy SOL on Robinhood, but you can send it in its Robinhood Wallet app.
Jack Inabinet