TALLAHASSEE, Fla. — Florida Lawyer Basic James Uthmeier has launched an official investigation into Robinhood Crypto, LLC, accusing the corporate of doubtless violating Florida’s Misleading and Unfair Commerce Practices Act. The probe facilities round claims that Robinhood misled customers by selling its platform as the most affordable approach to purchase and promote cryptocurrency.
In response to Uthmeier, there’s proof that contradicts Robinhood’s advertising and marketing claims, suggesting that customers may very well be paying extra in hidden prices in comparison with different crypto buying and selling platforms. Robinhood has marketed that prospects “get probably the most crypto on your cash” and “commerce crypto on the lowest value on common.” Nevertheless, the corporate’s income mannequin—primarily based on “cost for order move” (PFOF)—might end in much less favorable pricing for customers. Below this construction, Robinhood routes person trades to third-party corporations that compensate Robinhood for the order, which critics say can cut back transparency and improve transaction prices.
“Crypto is an important part of Florida’s monetary future, and President Trump’s efforts to advance the crypto market will make America stronger and wealthier,” Uthmeier stated in a press release. “When shoppers purchase and promote crypto belongings, they deserve transparency of their transactions. Robinhood has lengthy claimed to be the perfect discount, however we imagine these representations have been misleading.”
As a part of the investigation, the Lawyer Basic’s Workplace has issued a subpoena to Robinhood Crypto requesting a variety of inside paperwork. The request contains advertising and marketing supplies, worker rosters, charge disclosures, pricing methods, and inside communications associated to crypto buying and selling prices. The state can be searching for information on the variety of Florida customers in 2024 and the small print of their crypto transactions.
Robinhood Crypto has till July 31, 2025, to adjust to the subpoena.
“Our disclosures are best-in-class — We disclose pricing info to prospects in the course of the lifecycle of a commerce that clearly outlines the unfold or the charges related to the transaction and the income Robinhood receives. We’re proud to be a spot the place prospects can commerce crypto on the lowest value on common.” – Lucas Moskowitz, Basic Counsel, Robinhood Markets, Inc.
The investigation highlights rising scrutiny of buying and selling platforms which have risen in reputation amid the crypto increase, particularly people who market themselves as low-cost options whereas utilizing advanced income fashions which will obscure true prices for shoppers.
