Robinhood Markets Inc. is continuing to engage with the US Securities and Exchange Commission after receiving a warning from the financial regulator in May, according to Chief Executive Officer Vlad Tenev, foreshadowing an enforcement action.
The retail trading platform has submitted a response to what is known as an SEC Wells notice related to the firm’s cryptocurrency business, Tenev said Thursday in an interview on Bloomberg Television.
“We’ve spent a lot of time making sure that the response is as high-quality as possible,” he said, adding that he had no further updates to share.
Since the pandemic-era retail trading mania that engulfed Robinhood, the firm has diversified its business, expanding into retirement products and credit cards as well as crypto ventures outside of the US. It is still best known as a popular and accessible trading platform.
Robinhood competitors including Charles Schwab Corp. and Fidelity Investments dealt with outages amid a global stock-market selloff on Monday. Tenev said the firm’s technology is strong, and they didn’t have issues “of a significant nature when the competitors were down.”
“Now, when we see high volumes, we’re ready for it,” he said. “Customers tend to be buying the dip–there are more buyers than sellers, which we think is a really good sign for the health of the retail market.”
The firm, known for its varied options that include 24-hour trading, did face some disruption after its execution venue Blue Ocean ATS suspended overnight trading, according to a Robinhood statement on Monday. Tenev said Blue Ocean wasn’t able to handle the scale and the infrastructure “basically fell over.”
“We look to make sure they enable it for all of their customers and all of our customers as soon as possible,” he said.
Menlo Park, Calif.-based Robinhood reported second-quarter earnings on Wednesday that beat analysts’ expectations, with net revenue of $682 million for the period.
Robinhood rose 2.2% to $17.50 at 11:32 a.m. in New York on Thursday, giving the company a market value of about $15.5 billion.
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