Robinhood inventory (NASDAQ: HOOD) plunged over 10% on Monday, marking the inventory’s worst efficiency within the S&P 500 as a brutal crypto market sell-off collided with fading exercise within the firm’s prediction markets.
The brokerage big, which surged 188% in 2025, is now down 40% from its October peak of $153, as buyers confront the truth that Robinhood’s fortunes rise and fall with retail buying and selling urge for food and cryptocurrency costs.
The slide prolonged premarket weak point right into a extreme session decline, with buying and selling quantity swelling 40% above common as sellers overwhelmed bids.
Bitcoin’s weekend collapse triggered a cascade of losses throughout retail buying and selling platforms.
The digital asset plummeted from $83,800 Friday to a nine-month low of $74,570, erasing over $200 billion in crypto market worth and forcing $2 billion in liquidations throughout leveraged positions.
That massacre straight hit Robinhood’s pockets.
In 2025, cryptocurrency transaction income surged 200% to $268 million per quarter, changing into the platform’s fastest-growing income driver and accounting for roughly 40% of complete transaction income.
Robinhood inventory: Crypto squeeze and seasonal prediction-market fade
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Robinhood’s sensitivity to crypto weak point is excessive.
With a beta of two.45, which means the inventory swings 2.5 occasions more durable than the broad market, HOOD is basically a leveraged guess on retail threat urge for food, not on the energy of its underlying enterprise.
Piper Sandler, which maintains an Obese ranking with a $155 worth goal, flagged three near-term headwinds: softer crypto buying and selling volumes, the top of the NFL season denting prediction-market income.
The prediction-markets angle is essential.
Robinhood launched soccer contract buying and selling in August 2025 and quickly grew to become the fastest-growing phase.
CEO Vlad Tenev instructed buyers the enterprise was “rising quickly,” with 2.5 billion contracts traded in October alone. However soccer season ends in February.
Robinhood is banking on the NBA and MLB to fill the void, however seasonal income vacuums traditionally set off valuation resets in fintech shares.
Valuation collapse amid profit-taking
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The broader backdrop issues. After a 188% rally in 2025, the inventory trades at a ahead price-to-earnings ratio of 44 and a price-to-sales of 23, each nicely above historic averages.
Many institutional buyers are additionally taking earnings.
With out near-term catalysts, the inventory is susceptible to continued promoting.
November working information confirmed buying and selling volumes sank 37% in equities, 28% in choices, and 12% in crypto.
Robinhood’s buyer acquisition tempo is slowing, and a Connecticut regulatory cease-and-desist order over unauthorized playing language provides headline threat.
Robinhood releases fourth-quarter and full-year 2025 earnings on February tenth after market shut, with CEO Vlad Tenev internet hosting a video name at 5:00 PM ET.
Analysts anticipate income of $1.34 billion (up 32% year-over-year) however EPS of $0.63, down 38% from the prior-year quarter as bills surge.
If steerage disappoints or fails to deal with crypto volatility threat, anticipate additional draw back. Help sits close to $85; resistance is $105.
