Robinhood’s $221 million crypto revenue drop shows crypto winter isn’t on chain and retail already moved
Crypto winter has a branding downside.
The phrase makes it sound just like the chain goes quiet, wallets cease shifting, and the entire machine turns chilly. However, the cleanest proof of retail pulling again hardly ever lives on-chain.
The individuals who vanish first aren’t the ability customers bridging stables into DeFi or the long-term holders shuffling cash between chilly storage addresses. They’re the informal individuals who present up when danger feels enjoyable, open a dealer app, faucet market purchase, and then disappear with out leaving a neat on-chain footprint.
That’s why essentially the most usable retail barometer sits in an usually missed place: the earnings strains of Robinhood and Coinbase.
When retail exercise thins out, brokers really feel it as fewer trades, decrease notional, and much less transaction revenue. When retail warms up, it shows up as increased engagement and increased take.
You can have a Bitcoin chart that appears alive whereas participation is shrinking, as a result of value is now carried by a narrower set of patrons utilizing ETFs, futures, and different structured merchandise.
A participation recession can coexist with a value rebound. You solely want to take a look at what these two corporations simply reported to see how that break up appears to be like in follow.
Robinhood’s fourth quarter made the purpose in numbers which are exhausting to argue with. Total web revenues rose 27% 12 months over 12 months to $1.28 billion, with transaction-based revenues up 15% to $776 million.
But the composition of that revenue is essential.
Options revenue got here in at $314 million, up 41%, and equities revenue hit $94 million, up 54%. Crypto revenue, on the opposite hand, fell to $221 million, down 38% YoY.
That’s what a retail rotation appears to be like like.
Coinbase, which many nonetheless deal with as a proxy for retail crypto demand, reported the identical chill from a special angle.
In its This fall’25 shareholder letter, whole revenue was $1.781 billion, with transaction revenue at $982.7 million and subscription and companies revenue at $727.4 million. Consumer transaction revenue was $733.9 million for the quarter, down from $843.5 million in Q3. Institutional transaction revenue rose to $185.0 million from $135.0 million. The firm additionally reported a $667 million web loss for the quarter.
Put these collectively, and you get the identical downside as Robinhood: retail exercise cooled, the enterprise leaned tougher on non-transaction strains, and the quarter made extra from its companies stack than buying and selling.
The retail barometer lives in dealer P&L
On-chain metrics can let you know whether or not whales are distributing, whether or not long-term holders are spending, whether or not stablecoin provide is increasing, and whether or not the bottom layer is busy.
But they’ll additionally mislead you about retail participation as a result of the retail cycle is about individuals actively buying and selling, not simply cash shifting.
Quite a lot of at present’s circulation sits inside wrappers the place the chain by no means sees it. If somebody buys publicity by means of a dealer, hedges it with listed options, or trades inside an inner venue, the person expertise is busy, however the chain can look calm.
Robinhood is constructed round that person expertise, so we will have a look at its quarterly report like a behavioral survey with a P&L connected. The firm ended This fall with 27 million funded clients and an ARPU of $191.
Those may not be crypto-native metrics, however they’re precisely what you need whenever you’re making an attempt to reply one plain query: are individuals nonetheless collaborating?
The participation reply in Robinhood’s case is sure.
But the chance reply is extra particular: retail has leaned into devices that provide outlined outcomes and quick suggestions, with choices and occasion contracts being the preferred.
Operating knowledge makes that clearer.
Options contracts traded hit 659 million in This fall, up 38% 12 months over 12 months. Crypto notional buying and selling volumes have been $82 billion, with $48 billion tied to Bitstamp and $34 billion on the Robinhood app, the place notional fell 52% 12 months over 12 months. Event contracts traded reached 8.5 billion in This fall.
Robinhood can name 2025 a report 12 months and nonetheless present you a crypto winter within the precise place it really hurts a retail-facing dealer: the crypto revenue line and the app’s crypto notional.
Transaction-based revenue received a carry from equities and choices, whereas crypto lagged at $221 million and missed expectations that clustered increased. That helped clarify why the quarter disenchanted, even with report web revenue.
That issues as a result of it frames crypto winter weak spot as a participation situation, not a product failure. The platform saved its viewers, however the viewers simply did much less crypto buying and selling.
Coinbase is totally different as a result of it sits nearer to the core venue economic system. Retail and institutional circulation share the identical model even after they behave in a different way.
The shareholder letter spells out the combo shift while not having any additional interpretation: transaction revenue for This fall was $983 million, down 6% quarter over quarter.
Coinbase attributes the buyer decline to weaker client spot quantity and combine shifts. Institutional transaction revenue rose quarter over quarter, whilst institutional spot quantity fell.
When 1 / 4 appears to be like like that, it means retail is stepping again whereas institutional circulation turns into comparatively extra essential.
It additionally means the enterprise mannequin is shifting towards recurring revenue, so it doesn’t stay and die on the following buying and selling frenzy. That type of winter-proofing is best to see within the subscription and companies part.
Coinbase reported $727.4 million in subscription and companies revenue in This fall and $364.1 million in stablecoin revenue alone. Stablecoin revenue helped cushion the hit from weaker buying and selling volumes.
That is, indisputably, essentially the most misunderstood a part of the cycle, as a result of the market assumes that crypto winter equals inactivity.
However, in follow, crypto winter usually signifies that the enterprise of crypto strikes towards rails, custody, and yield-like revenue streams that preserve working even when retail goes house.
Price can get better whereas participation stays skinny
A crypto winter turns into simpler to know when you separate the value of Bitcoin from the breadth of participation round it. Price will be supported by a smaller set of patrons utilizing regulated wrappers, hedging devices, and institutional steadiness sheets.
That can preserve the chart alive whereas the tradition of participation feels muted. You see it when the large numbers focus in fewer pipes and the spillover into every part else fades.
Coinbase’s personal working notes trace at that focus. Consumer spot buying and selling quantity was $56 billion in This fall, whereas institutional spot buying and selling quantity was $215 billion.
You don’t need to romanticize institutional adoption to see what that suggests. In quarters like this, the market can operate with fewer individuals, but it surely behaves in a different way. It can rally on reallocations, hedge flows, and macro positioning, with out lighting up the broader set of behaviors that individuals affiliate with a full mania.
Robinhood’s quarter provides you the retail model of that.
People are nonetheless buying and selling, however crypto is not the default outlet for that vitality. Options revenue was up 41% 12 months over 12 months, and occasion contracts turned a central product line that the corporate selected to highlight.
The urge for food for motion received redirected into devices that really feel extra controllable, extra game-like, or extra legible in a market the place sentiment turned bitter.
That redirection additionally explains why gazing on-chain exercise will be complicated.
On-chain can look secure as a result of the customers who stay are those who really use the rails.
Meanwhile, the marginal participant who drives the emotional quantity of a cycle can disappear with out leaving a neat signature, as a result of that participant’s complete relationship with crypto was mediated by means of apps, wrappers, and dealer interfaces.
Coinbase tied its weak quarter to a broader crypto selloff and pointed to the best way buying and selling volumes can collapse shortly when danger sentiment breaks.
Robinhood made an identical level from the opposite facet, displaying that equities and choices can preserve the retail engine operating even when crypto cools.
So the place did retail danger go?
Robinhood’s numbers hand you three solutions.
First, it went into listed choices, with 659 million contracts traded in This fall. Second, it went into occasion contracts, with 8.5 billion traded within the quarter. Third, a few of it simply stopped expressing itself by means of crypto notional on the Robinhood app, which the corporate stated fell 52% 12 months over 12 months.
Coinbase’s reply is that retail cooled, institutional circulation held up higher, and the corporate leaned tougher on stablecoin-driven revenue and different subscription and companies strains to maintain the enterprise much less dependent on retail churn.
All of this tells us that when retail steps again, the trade rebalances across the elements that may preserve incomes.
However, markets can get better earlier than individuals do, and value can stabilize whereas participation stays selective.
The first place you will see the crypto winter ending and the group coming again would be the earnings line that data whether or not individuals are clicking, buying and selling, and paying spreads once more.
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