Robinhood Crypto Trading is WORSE Than You Think!! - YouTube

In this video, I go over why you should avoid Robinhood Crypto Trading like the plague.

No, this is not clickbait, I'm being 100% serious, Robinhood Crypto Trading is worse

than what you think. And every time someone mentions to me that they trade crypto on Robinhood,

part of me dies inside every time. And so I'm making this video in order to warn people

or tell people why Robinhood Crypto Trading is a really bad idea. If you're new here,

hi my name is Xena; I make personal finance videos but only a small percentage of my viewers

are actually subscribed to my channel. So hit subscribe and the notification bell down

below. It's free for you to do and you can always unsubscribe later. And remember boys

and girls, this is not financial advice, this is for entertainment purposes only and these

are my own opinions. But the first reason why you should not trade crypto on Robinhood

platform is that the crypto isn't really yours, it's Robinhood's. Now I know that sounds like

a huge claim but I have good reasoning for it. The whole point of cryptocurrency and

why Bitcoin was made in the first place and other altcoins were made is to be decentralized.

Decentralized finance is a concept where financial products are available on a public decentralized

blockchain network, making them open for anyone to use rather than going through some type

of middleman like banks and brokerages. Which means that not one single entity controls

it and therefore it is decentralized. However, Robinhood Crypto trading is not like that

all. When you have your crypto with Robinhood, there literally is zero utility to it because

you can't buy anything, you can't receive anything because you don't have your wallet

address, you can't earn interest on your crypto like on other platforms. Now, what exactly

do I mean by that? Okay, here is Robinhood's FAQ section on their Cryptocurrency Transfers

and Deposits. They do not provide you with access to your wallet or your wallet address.

Now, if you don't have access to your wallet address, you cannot send and receive Bitcoin,

you can't send and receive other cryptocurrencies, you basically can't do anything without your

wallet address. Look what they say about coin deposits and withdrawals. At this time, Robinhood

does not have the functionality to allow customers to transfer their existing cryptocurrency

assets into or out of their Robinhood account. So if you wanted to put it in a different

wallet, you can't do that, there is like zero functionality. You also cannot use crypto

at all when you have it in Robinhood because Robinhood only lets you buy and sell crypto;

it only let's you trade crypto. But you can't send it to a friend, you can't send it to

a different wallet address because you don't even know your own wallet address because

they don't give you access to it. You cannot purchase anything with your crypto that is

held on your Robinhood account. You can't do that and basically you'll be unable to

use your crypto for what it was made to be, as a digital currency. The next reason why

you should avoid Robinhood crypto trading is because Robinhood is notorious for outages.

They recently had two crypto outages on April 15th and April 16th. During those dates, Dogecoin

the cryptocurrency that is a meme but it is now in the top 10 cryptocurrencies based on

market cap, which is Funny. It hit an all-time high of over 40 cents, it went to roughly

43 cents and these two days. And a lot of crypto traders on Robinhood wanted to cash

out and get them sweet, sweet, tendies. They wanted to sell their Dogecoin to get them

tendies because Dogecoin was at an all-time high. However, where was Robinhood?Robinhood

crashed. Robinhood did make a blog post on this event. On Friday morning, we saw a similar

spike in activity as Dogecoin rose to nearly 50 cents. For Robinhood this led to sporadic

crypto order failures and delayed notifications for some customers. Imagine if you were trading

crypto on Robinhood which is the only thing you could do with the crypto you own on Robinhood,

and you can't even trade and sell when it's at an all-time high. What sucks is that by

the time their platform was up, Dogecoin went down and so all those people that wanted to

sell when it was at nearly 50 cents, they were not able to sell and get those gains.

There were a ton of acusations stating that Robinhood was restricting cryptocurrency trading

because Dogecoin was up. However, Robinhood did come out and say that no, they were not

restricting trading. There is just so much trading going on that their platform basically

failed, which is still not okay. Crypto trading on Robinhood is new and this event or outage

was one of the first ones for crypto trading on their platfom. However, they've been notorious

for outages on their platform when it comes to investing in stocks. In 2020, last year

they had over 70 outages where investors lost money because they couldn't buy or sell stocks.

So not only does your cryptocurrency in Robinhood basically have zero use because you can't

withdraw it, you can't buy anything with it, you can't deposit it anywhere else, no one

can even send you cryptocurrency; so there's zero utility for it when it's in your Robinhood

account. The only thing you could do is trade and with trading, they still have errors.

You could be losing money whenever there is an outage and I don't want that happening

to you. The next reason why you should not trade crypto on Robinhood are the fees. Now,

Robinhood got really popular because they offer $0 commissions. There's no fees whatsoever

and that's how they marketed themselves. Robinhood recently paid a $65 million fine for deceiving

its customers. According to the SEC, Robinhood investing did not live up to its duty to ensure

that users got the best terms on their trades. The SEC alleged that by going along with Robinhood's

$0 trading commissions over other brokerages that do charge fees, investors missed out

on $34 million over a roughly three year span thanks to inferior trade prices. And that's

after factoring out the cost of over $5 trade commissions. So basically, it's better for

you as a trader to pay a $5 commission fee instead of using Robinhood. You're basically

saving a penny to lose a nickel and that's why I don't buy any cryptocurrency on Robinhood

and that's why I don't use Robinhood at all. There are lots of other alternatives where

you can trade and invest in cryptocurrency. My two favorites are Gemini and BlockFi. You

can get $10 worth of free cryptocurrency with Gemini when you sign up with my affiliate

link. And you can get up to $250 worth of free cryptocurrency when you sign up with

my BlockFi affiliate link down below in the description. Don't forget to subscribe to

my channel and hit the notification bell down below. I release two new personal finance

videos every week. And while you're at it, be sure to watch this video next, I'm sure

you'll love it. And with that, thanks for watching and I will see you guys in this video.

Bye!