Robinhood Markets Inc ( HOOD ) shares are trading lower by 11.1% to $44.33 during Tuesday’s session after the price of Bitcoin fell below $90,000.

What To Know: Robinhood Markets ( HOOD ) saw its stock fall sharply Tuesday as Bitcoin's sharp decline triggered a broader cryptocurrency sell-off, raising concerns about the trading platform's transaction-driven revenue. Shares of Robinhood dropped in tandem with Bitcoin's 7% plunge, which sent the total crypto market capitalization down by around 9%.

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As a retail brokerage known for its commission-free trading model, Robinhood derives a significant portion of its revenue from crypto transactions. Robinhood’s crypto trading volume surged over 400% year-over-year to $71 billion in the fourth quarter of 2024.

Additionally, since the start of the 2024 fourth quarter, the company has added seven new crypto assets in the U.S. and launched Ethereum staking in the EU.

In general, a downturn in crypto prices often leads to lower retail trading activity, reducing transaction volume and subsequently impacting Robinhood's earnings.

What Else: The latest crypto market correction, driven by Solana's decline and a broader risk-off sentiment, has also drained liquidity from smaller assets like meme coins, which have been a major source of speculative trading on Robinhood. With risk appetite fading for now, analysts expect trading activity to slow, potentially pressuring Robinhood's revenue in the coming quarters.

As Bitcoin stabilizes, Robinhood investors will be watching closely to see whether retail traders return or if the recent downturn signals a prolonged pullback in crypto trading enthusiasm.

Read Also: SEC Drops Investigation Into Robinhood’s Crypto Unit

According to data from Benzinga Pro, HOOD has a 52-week high of $66.08 and a 52-week low of $13.98.