In a recent report, Robinhood, the well-known trading platform, revealed its financial results for the second quarter of the year. The report showed a notable 18% drop in transaction trading revenue related to cryptocurrencies, which came shortly after the company’s decision to delist three major altcoins – Solana (SOL), Cardano (ADA), and Polygon (MATIC). These developments were prompted by the ongoing SEC lawsuit against Binance and Coinbase, further adding to the market uncertainty surrounding the crypto landscape.

Robinhood, primarily known for its stock trading services, has been steadily expanding into the cryptocurrency realm over the past few years. Prior to the delisting, the platform allowed users to trade a total of 18 different cryptocurrencies. While this may be fewer assets compared to other crypto exchanges, Robinhood’s crypto trading had been gaining momentum, benefiting from the success of its stock trading services. According to its balance sheet, the company had approximately $11.503 billion in user cryptocurrencies safeguarding obligation.

However, the delisting of the three altcoins had an impact on the crypto trading volume. In the second quarter, Robinhood’s transaction-based revenues declined by 7%, while crypto trading revenue experienced an 18% decrease, amounting to $31 million, compared to $38 million in the previous quarter.

Although an 18% drop might not sound drastic, for a rapidly growing company like Robinhood, any decline in a significant revenue segment can have implications on other sectors of its operations. Investors and users were closely observing these developments, as they could signal potential challenges for the company’s future growth in the cryptocurrency market.

The decision to delist SOL, ADA, and MATIC was driven by the SEC’s classification of these altcoins as securities in recent legal actions against other prominent exchanges like Binance and Coinbase. This classification raised concerns among regulatory circles and prompted Robinhood to take preemptive measures to comply with the evolving regulatory landscape.

Interestingly, Bakkt, another digital assets platform based in New York, also followed a similar path and delisted the same altcoins, indicating a cautious approach taken by various players in the market.

Despite the crypto-related challenges, the financial results showed a silver lining for Robinhood. The company achieved profitability in the second quarter, a noteworthy feat considering the impact of the crypto market fluctuations. Total net revenues experienced a 10% sequential increase, reaching $486 million, and net interest revenue rose by 13% to $234 million. As a result, total net income amounted to $25 million, a significant turnaround from the $511 million net loss reported in the first quarter of the year.

The company’s Assets Under Custody (AUC) also saw a positive trend, increasing by 13% from the previous quarter to reach $89 billion. This growth was primarily driven by a net deposit of $4.1 billion during the period.

In the stock market, Robinhood’s share price showed a decline of 7.31% in the past five days following the release of the financial report. However, it’s worth noting that the company’s stock price had performed remarkably well throughout the year, with a 42.82% increase since the beginning of the year, reflecting investors’ confidence in the platform.

Despite the challenges faced in the crypto segment, Robinhood’s overall financial picture remains promising. As the company continues to navigate the evolving regulatory landscape and adapt to market demands, it will likely continue to solidify its position as a leading player in both the stock and crypto trading domains.