Robinhoods' cryptocurrency division was fined $30 million by New York state for breaking cybersecurity regulations, money laundering, and consumer protection this month.
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According to regulators, Robinhood violated several laws, including rules relating to virtual currencies, money transmission, transaction monitoring, and cybersecurity. The business is now required to hire an independent consultant to investigate and investigate any deficiencies in Robinhood's compliance with New York state laws.
Robinhood Crypto failed to invest the appropriate resources and time to develop and maintain a culture of compliance, according to the Department of Financial Services Superintendent.
Robinhood for lagging staffing in its operations against money laundering and bank secrecy, and that the company did not mobilize resources to deal with threats, including operational hazards related to virtual currencies, according to state regulators.
Robinhood has dismissed over a quarter of its workforce due to recent market volatility, which saw a 44% decline in revenue.
In an announcement, CEO Vlad Tenev said that inflation has reached 40-year highs, as well as a widespread crypto market crash. "This has further decreased customer trading activity and assets under custody.
Robinhood hasn't slowed down on the crypto front. Last week, the company announced support for the popular altcoins Avalanche andStellar. Both of the tokens saw their price spike as the company announced the digital currencies.
Sam Bankman-Fried, a crypto millionaire who is also the CEO of FTX, disclosed that he had taken a 7.6% stake in the company earlier this year, triggering suspicions that he might purchase the popular trading platform.