Robinhood’s Crypto Revenue Hits Record High

CRYPTO
Robinhood’s Crypto Revenue Hits Record High

Robinhood saw a 500% surge in cryptocurrency revenue in Q4, reaching $358 million, as the trading app reported record-breaking profit and revenue. Overall revenue rose 37% to $1.01 billion, while net income hit $916 million, far exceeding analysts' expectations of 42 cents per share with an actual EPS of $1.01.

Shares jumped 7% in after-hours trading, bringing Robinhood’s stock up 360% in 2024. CEO Vlad Tenev credited the company's rapid product expansion for its success.

Crypto trading on Robinhood surged as retail investors returned amid a bull market. Crypto fees, which hit a three-year low of $23 million in Q3 2023, rebounded to $126 million in early 2024.

Robinhood’s crypto business has attracted SEC scrutiny, but after Trump’s election, the regulatory stance softened. Tenev remains bullish on blockchain’s role in finance, predicting tokenization as the next evolution in financial services.

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TECH
OpenAI Rejects Musk’s $97.4B Offer

OpenAI’s board has formally rejected a $97.4 billion offer from Elon Musk and a group of investors to purchase the nonprofit that oversees the AI company. Chairman Bret Taylor stated that OpenAI is not for sale and dismissed Musk’s attempt as an effort to disrupt competition.

Musk, who co-founded OpenAI before launching rival AI startup xAI, aimed to return OpenAI to its open-source, safety-focused roots. However, CEO Sam Altman dismissed the bid as a competitive tactic to slow OpenAI down.

Musk has also filed two lawsuits against OpenAI, challenging its shift toward a for-profit model. Meanwhile, OpenAI is negotiating a new funding round with SoftBank, potentially valuing the company at $300 billion.

Legal experts suggest Musk’s bid could impact how OpenAI values its nonprofit assets, possibly affecting future investor equity and regulatory scrutiny over its governance structure.

TECH
DeepSeek R1 Sparks AI Market Shift

The release of DeepSeek’s R1 AI model initially led analysts to question whether the rapid efficiency improvements in artificial intelligence could slow demand for data center infrastructure. However, new assessments suggest that more efficient AI models could ultimately boost demand, rather than diminish it.

UBS now forecasts 20% growth in the data center sector in 2025, revising its earlier expectations. Bruce Owen, EMEA president at Equinix, describes new AI models as an “accelerant” for growth, rather than a disruptive force.

While investors initially worried that DeepSeek’s cost-efficient AI could undermine demand for power-intensive data centers, experts now believe lower costs will drive AI adoption further, fueling even greater demand for cloud computing and AI infrastructure.

The structural transformation of AI technology, driven by more efficient computing, will reshape enterprise investments in AI infrastructure, but the long-term trend points toward continued expansion rather than contraction.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.