Florida’s attorney general has launched an investigation into Robinhood Crypto (NASDAQ:HOOD), LLC, probing whether the platform misled users about the true cost of trading digital assets. The inquiry centers on suspicions that Robinhood’s promotional messaging may have violated state consumer protection laws.
Attorney General James Uthmeier announced Thursday that his office has issued a subpoena demanding internal documents from Robinhood’s cryptocurrency division. Investigators are examining whether the company violated Florida’s Deceptive and Unfair Trade Practices Act by marketing its platform as the most affordable option for crypto transactions.
“Crypto is a vital component of Florida’s financial future, and President Trump’s efforts to advance the crypto market will make America stronger and wealthier. When consumers buy and sell crypto assets, they deserve transparency in their transactions,” said Uthmeier. “Robinhood has long claimed to be the best bargain, but we believe those representations were deceptive.”
Robinhood has built its reputation on commission-free trading, generating revenue instead through a model known as payment for order flow (PFOF). This arrangement allows third-party firms to execute customer trades — and pay Robinhood for the privilege — raising questions about whether users are actually receiving the best possible prices.
Despite the company’s assertion that it offers “the most crypto for your money,” Florida regulators suggest that the PFOF model could lead to higher effective trading costs for consumers compared to rival platforms.
In a statement to Investing.com, Robinhood’s General Counsel Lucas Moskowitz defended the company’s practices. “Our disclosures are best-in-class — We disclose pricing information to customers during the lifecycle of a trade that clearly outlines the spread or the fees associated with the transaction and the revenue Robinhood receives. We are proud to be a place where customers can trade crypto at the lowest cost on average.”
The state’s subpoena demands a wide range of records, including marketing materials, customer communications, internal pricing analyses, and agreements with trading partners. Authorities are particularly interested in documents detailing Florida-based trades from 2024.
The outcome of the investigation could have implications not just for Robinhood’s crypto business, but also for how digital asset platforms are regulated at the state level going forward.
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