Robinhood stock (NASDAQ: HOOD) plummeted more than 10% on Monday, marking the company’s worst performance in the S&P 500 index as a ferocious slide in the crypto market combined with a decline in activity in the company’s prediction market.
The securities giant, which soared 188% in 2025, is now down 40% from its October high of $153, leaving investors facing the reality that Robinhood’s fortunes rise and fall based on individual trading appetite and the price of cryptocurrencies.
The decline extended pre-market weakness into a deep session decline, with trading volume 40% above average as sellers overwhelmed bids.
Bitcoin’s weekend selloff caused cascading losses across retail trading platforms.
The digital asset plummeted from $83,800 on Friday to a nine-month low of $74,570, wiping out more than $200 billion in cryptocurrency market value and forcing the liquidation of $2 billion across leveraged positions.
The bloodshed hit Robin Hood’s wallet.
In 2025, cryptocurrency trading revenue grew 200% per quarter to $268 million, making it the platform’s fastest growing revenue driver and accounting for approximately 40% of total trading revenue.
Robinhood Stock: Cryptocurrency Stress and Seasonal Forecast – Market Decline
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Robinhood is extremely sensitive to crypto vulnerabilities.
With a beta of 2.45, meaning the share price is 2.5 times more volatile than the broader market, HOOD is essentially a leveraged bet on retail risk appetite rather than the strength of the underlying business.
Piper Sandler maintains an “overweight” rating with a $155 price target, but points to three short-term headwinds: weak crypto trading volume and a decline in projected market returns due to the end of the NFL season.
The prediction market angle is very important.
Robinhood launched soccer contract trading in August 2025 and has quickly become a fast-growing segment.
CEO Vlad Tenev told investors the business was “growing rapidly” with 2.5 billion contracts traded in October alone. But the football season ends in February.
Robinhood is relying on the NBA and MLB to fill the gap, but historically seasonal revenue gaps cause valuations for fintech stocks to reset.
Valuation collapses due to profit taking
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The broader context is important. After a 188% rally in 2025, it trades at a price-to-earnings ratio of 44 times and a price-to-sales multiple of 23 times, both well above historical averages.
Many institutional investors are also taking profits.
Without short-term catalysts, stocks are likely to continue selling.
Trading volumes fell 37% for stocks, 28% for options and 12% for cryptocurrencies, according to November operating data.
Robinhood’s customer acquisition rate has slowed, and a cease-and-desist order from Connecticut regulators on unlicensed gambling terms has increased headline risk.
Robinhood will release its fourth quarter and full-year 2025 earnings after the market closes on February 10th, and CEO Vlad Tenev will host a video call at 5pm ET.
Analysts expect sales to be $1.34 billion, up 32% year-over-year, but EPS to be $0.63, down 38% year-over-year, due to soaring expenses.
Further declines are expected if guidance disappoints or fails to address crypto volatility risks. Support is near $85. Resistance is $105.
