Robinhood Faces Florida Investigation for ‘Low-Cost’ Crypto Marketing
2025-07-11 02:50:03
Main Idea
Florida's Attorney General is investigating Robinhood for allegedly misleading customers with its 'low-cost' crypto marketing, accusing it of violating state trade practices laws.
Key Points
1. Florida Attorney General James Uthmeier subpoenaed Robinhood's crypto unit, alleging deceptive marketing about being the cheapest way to buy digital assets.
2. Robinhood's zero-commission model relies on payment for order flow (PFOF), which critics argue obscures true costs for customers.
3. EU regulators are also investigating Robinhood's blockchain-based 'Stock Tokens' due to controversy over their connection to OpenAI.
4. Robinhood defends its fee transparency, stating it shows users the lowest average cost for crypto purchases.
5. PFOF accounted for 15%-20% of Robinhood's revenue in 2023, though the company argues it keeps trading accessible.
Description
Florida Attorney General James Uthmeier has opened an investigation into Robinhood Crypto, alleging the platform may have misled customers by marketing itself as the cheapest way to buy digital assets. In a statement on Thursday, the attorney general’s office said it issued a subpoena to Robinhood’s crypto unit, seeking internal documents, marketing materials and pricing data. The probe aims to determine whether the company violated Florida’s Deceptive and Unfair Trade Practices Act. “When consu...
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