The popular American investment app, Robinhood, is losing more than 4% today. This follows unfavorable information regarding the legal struggles the company is facing.
- The company is facing a lawsuit under the "Securities Act of 1933," with the dispute centered around its 2021 IPO. As the class-action lawsuit indicates, the company misled investors regarding its financial situation and growth prospects.
- According to the lawsuit, the company failed to disclose, among other things, its critical reliance on seasonal revenue from cryptocurrency investments and the so-called meme stocks - a phenomenon highly popular during the 2021 IPO period.
- Since the IPO price of $38 per share, the company lost approximately 80% of its valuation between 2022 and 2024. The debut level was only surpassed in 2025, after which the stock price experienced very high volatility.
- Recently, the company recorded two series of noticeable, yet fragile, increases by several dozen percent. One of these was a valuation increase of approximately 40% following the introduction of "investment tokens" for shares of private companies such as OpenAI and Anthropic. The nature and value of such instruments are currently difficult to estimate.
The Supreme Court, to which the Robinhood case was referred, has asked Donald Trump's administration for an opinion on the quality of the IPO and the merits of the lawsuit.
HOOD.US (D1)
The valuation on the chart is currently within a consolidation channel between the Fibonacci retracement levels of 50% and 78.6%. After testing the 61.8% level, the price broke into the upper range of consolidation, stopping at the EMA averages. However, the averages themselves are sending a strong bearish signal—the EMA100 crossed the EMA200 from above. Source: xStation5
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