Robinhood will bolster its crypto services for European users in anticipation of a more transparent regulatory framework in the region.
EU users have been able to buy, hold, and sell crypto within Robinhood’s app since last year. However, they were previously unable to transfer tokens from another exchange or withdraw their crypto to an external wallet.
The new functionality will support 24 cryptocurrencies, including bitcoin, Ethereum, Solana, and USDC. In an interview with CNBC, Robinhood’s leadership said that the European market “can become a very attractive market next year,” due to the EU’s Markets in Crypto-Assets (MiCA) regulations.
“Robinhood is going to see first mover advantages from tapping into the European markets,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “The MiCA regulations are expected to be fully in place by December, and they should provide solid guidance on operations for companies.”
An Attractive Alternative
There has been much anticipation for MiCA, which is expected to establish guidelines for issuing and trading digital assets, as well as specify how companies must authorize, supervise transactions, and provide disclosures.
A transparent legal framework will make the EU an attractive option for crypto companies. According to Robinhood, the EU rivals the U.S. in terms of total addressable crypto market. To encourage initial adoption, the company plans to offer EU customers 1% of their deposit’s value back in crypto.
A Comprehensive Crypto Framework
Many crypto industry experts believe MiCA could serve as a template for crypto regulation worldwide. However, the regulatory environment in the U.S. hasn’t been as conducive as in the EU.
The U.S. Securities and Exchange Commission believes crypto falls under existing securities laws and has taken action against major crypto players, alleging they operate as unregistered securities dealers.
The increased spotlight on crypto has only intensified as the U.S. elections approach, marking a significant shift from previous years. Regardless of the election outcome, all eyes will be on the EU as MiCA takes effect.
“It’s the first comprehensive crypto framework to be established, so there may be some challenges to overcome,” Hugentobler said. “However, it’s still a big step in the right direction overall. The EU is running laps around the U.S. in the crypto space.”